A monopolistically competitive firm will
A) charge the same price as its competitors do.
B) always produce at the minimum efficient scale of production.
C) have some control over its price because its product is differentiated.
D) produce an output level that is productively and allocatively efficient.
Answer: C
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The figure above shows the demand and marginal revenue curves facing Sue's Surfboards, the sole renter of surfboards on Big Wave Island. If Sue is renting 25 surfboards an hour so that the marginal revenue is negative, then Sue's Surfboards
A) can increase its profit by increasing the number of rentals. B) must face an inelastic demand for surfboard rentals. C) must face a unit elastic demand for surfboard rentals. D) must face an elastic demand for surfboard rentals.
When computing the opportunity cost of attending a basketball game you should include
a. the price you pay for the ticket and the value of your time. b. the price you pay for the ticket, but not the value of your time. c. the value of your time, but not the price you pay for the ticket. d. neither the price of the ticket nor the value of your time.