It has been argued that a monopolistically competitive industry involves "waste" because
A) there is too much product differentiation making shelves too crowded.
B) they end up producing to the right of the minimum of the average total cost curve and the price is below the marginal cost.
C) the firms do not equate marginal cost to marginal revenue to find the profit maximizing price and output.
D) the firms do not produce at the minimum of the average total cost curve and price is above marginal cost.
D
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A good or service with a positive externality is one which ______
A. everyone wants to have access to B. is produced in the social interest C. the marginal social benefit exceeds the marginal private benefit D. the marginal external benefit exceeds the marginal private benefit
If a cartel is unable to monitor its members and punish those firms that violate the agreement, then
A) the member firms will each act as price setters. B) the cartel will prosper in the long run. C) the market will become a monopoly. D) the cartel will fail.