If the LRAC curve for Company A has a clear minimum point without a curved bottom, then Company B will have ________________ if it produces a different number of units.
a. lower costs
b. higher costs
c. lower profits
d. higher profits
b. higher costs
When the LRAC curve has a clear minimum point, with a curved bottom instead of a flat bottom, then any firm producing a different quantity will have higher costs.
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The above figure shows the payoff to two airlines, A and B, of serving a particular route. If the two airlines must decide simultaneously, what happens if the government imposes a $20 per firm tax on firms that service this route?
A) Neither firm has a dominant strategy. B) Not entering is a dominant strategy for both firms. C) Neither firm entering is a Nash equilibrium. D) Only firm A will enter.
The demand curve for a monopolistic competitor is based on the extent of its product differentiation and how many competitors it faces
a. True b. False Indicate whether the statement is true or false