chapter 16 econ
equate marginal revenue and marginal cost
both monopolistic competition and monopoly
face a downward sloping demand curve
both monopolistic competition and monopoly
have marginal revenue that is less than price
both monopolistic competition and monopoly
monopoly/monopolistically competitive: equate marginal revenue and marginal cost
both monopolistic competition and perfect competition
the different between a buyer's willingness to pay and what the buyer actually pays
consumer surplus
represents welfare that is lost as a result of not producing at the efficient level
deadweight loss
a family owned farm is --- likely than a family owned restaurant to engage in advertising
less (a family owned restaurant would be more likely to advertise than a family owned farm because the output of the farm is sold in a perfectly competitive market, in which there is no reason to advertise, while the output of the restaurant is sold in a monopolistically competitive market)
the efficient level of output occurs where the demand curve insect the
marginal cost curve
perfectly competitive/monopolistic/monopolistically competitive: local electricity service
monopolistic (it is a natural monopoly - it is cheaper for one firm to supply all the output)
faces the entry of new firms selling similar products
monopolistic competition
has marginal revenue less than price
monopolistic competition
monopoly/monopolistically competitive: charges a price above marginal cost
monopolistic competition
sells a product that is differentiated from those of its competitors
monopolistic competition
monopoly/monopolistically competitive: faces the entry of new firms selling similar products
monopolistically competitive
perfectly competitive or monopolistically competitive: charges a price above marginal cost
monopolistically competitive
perfectly competitive or monopolistically competitive: has marginal revenue less than price
monopolistically competitive
perfectly competitive or monopolistically competitive: sells a product differentiated from that of its competitors
monopolistically competitive
monopoly/oligopoly/monopolistic competition/perfect competition: monitors
monopolistically competitive (bc there are many manufacturers, but each firm tries to differentiate its own brand from the rest)
perfectly competitive/monopolistic/monopolistically competitive: peanut butter
monopolistically competitive (different brand names exist with different quality characteristics)
perfectly competitive/monopolistic/monopolistically competitive: lipstick
monopolistically competitive (lipstick from different firms differs slightly, but there are a large number of firms that can enter or exit without restriction)
earns economic profit in the long run
monopoly
monopoly/monopolistically competitive: earns economic profit in the long run
monopoly
monopoly/oligopoly/monopolistic competition/perfect competition: microsoft's windows
monopoly (microsoft controls about 80-90% of the market for operating systems for desktop computers)
monopoly/monopolistically competitive: equates marginal revenue and marginal cost
monopoly and monopolistically competitive
monopoly/monopolistically competitive: faces a downward-sloping demand curve
monopoly and monopolistically competitive
monopoly/monopolistically competitive: has marginal revenue less than price
monopoly and monopolistically competitive
monopoly/monopolistically competitive: produces the socially efficient quantity of output
neither
perfectly competitive or monopolistically competitive: earns economic profit in the long run
neither
produce the socially efficient quantity of output
neither a firm in monopolistic competition nor a monopoly firm
nobody earns economic profit in the long run
neither a firm in monopolistic nor a firm in perfect competition
monopoly/oligopoly/monopolistic competition/perfect competition: central processing units
oligopoly (there are only a few firms that control a large portion of the market and engage in strategic pricing behavior)
produces at the minimum average total cost in the long run
perfect competition
monopoly/oligopoly/monopolistic competition/perfect competition: usb drives
perfect competition (there are many sellers and there is little differentiation among their products)
perfectly competitive or monopolistically competitive: produces at the minimum of average total cost in the long run
perfectly competitive
perfectly competitive/monopolistic/monopolistically competitive: copper
perfectly competitive (all copper is identical and there many producers)
perfectly competitive/monopolistic/monopolistically competitive: wooden no. 2 pencils
perfectly competitive (pencils by any manufacturer are identical and there are many manufacturers)
perfectly competitive or monopolistically competitive: equates marginal revenue and marginal cost
perfectly competitive and monopolistically competitive
you are hired as a consultant to a monopolistically competitive firm. the firm reports the following information about its price, marginal cost, and average total cost P=MC, P>ATC
the firm can increase its profit by reducing its output
