Answer the following questions true (T) or false (F)
1. Productive efficiency does not hold for a profit-maximizing, monopolistically competitive firm in the long-run equilibrium because the firm operates along the diseconomies of scale region of its average total cost curve.
2. Monopolistically competitive firms achieve allocative efficiency but not productive efficiency.
3. A monopolistic competitor does not earn profits in the long run unless it can successfully differentiate its product in the minds of its consumers.
1. FALSE
2. FALSE
3. TRUE
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When exchange rates are volatile:
A) firms are assured that they will be able to earn profits from currency swings. B) firms engage in more trade. C) trade and cross-border financial and labor flows are reduced as uncertainty and transaction costs take their toll. D) international economic activity is increased.
In a society where government mandates that everyone shares the product of one's hard work with everyone else, people will tend to work harder than they would if they could keep the full product of their work
Indicate whether the statement is true or false