Peet's Coffee and Teas produces some flavorful varieties of Peet's brand coffee. Is Peet's a monopoly?
A) No, Peet's is not a monopoly because there are many branches of Peet's.
B) Yes, Peet's is the only supplier of Peet's coffee in a market where there are high barriers to entry.
C) Yes, there are no substitutes to Peet's coffee.
D) No, although Peet's coffee is a unique product, there are many different brands of coffee that are very close substitutes.
D
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Your neighbor has just planted some fragrant flowers. The wonderful scent drifts into your room and makes you happy
A) This scent is an internal cost to you. B) This cannot be an externality since you are enjoying the scent. C) This is an externality since you get a benefit from your neighbor's flowers. D) The social cost of this activity is entirely borne by you neighbor.
In monopolistic competition, a firm
A. Uses nonprice competition. B. Uses marginal cost pricing. C. Has no market power. D. Faces a horizontal demand curve.