Which of the following is TRUE about monopolistic competition?
A) One firm serves as the entire industry.
B) A small number of firms serve the entire market.
C) It is competition among many firms producing similar but differentiated products.
D) The pattern of production and trade is difficult to predict.
E) It enjoys no economies of scale.
C
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In the figure above, which of the following is true?
i. Governments coordinate economic activities of households and firms. ii. Governments buy goods and services in goods markets. iii. Households pay taxes directly to firms. A) i and ii B) only i C) only iii D) ii and iii E) only ii
A price ceiling established below the market clearing price will usually cause
A) nonprice rationing. B) an excess supply. C) no change in the market clearing price. D) a decrease in the market clearing price.