For a monopolistically competitive firm, marginal revenue
A) and price are unrelated. B) is less than the price.
C) is greater than the price. D) equals the price.
B
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Oscar makes purchases of an existing product (X) such that the marginal utility of the last unit he consumes is 10 utils and the price is $5. He also tries a new product (Y) and the marginal utility of the last unit he consumes is 8 utils and the price is $1. The equal marginal principle suggests that Oscar should
A. increase his consumption of product Y and decrease his consumption of product X. B. increase his consumption of product X and increase his consumption of product Y. C. decrease his consumption of product Y and decrease his consumption of product X. D. increase his consumption of product X and decrease his consumption of product Y.
The term "shortage" refers to a:
A. situation in which the quantity supplied is less than the quantity demanded. B. situation in which the quantity demanded is less than the quantity supplied. C. signal that producers need to decrease the price of the good. D. market in which goods have to be sold quickly or the goods tend to rot or otherwise expire.