Ch. 16: AP Micro Monopolistic Competition

Ch. 16: AP Micro Monopolistic Competition

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Other, Social Studies

11th - 12th Grade

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Ian Lyons

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20 questions

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1.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

Monopolistically competitive firms are considered inefficient in allocating society’s resources for which of the following reasons? 
In long-run equilibrium, the marginal benefit exceeds the price charged by the firms. 
In long-run equilibrium, the price is greater than the marginal cost. 
In long-run equilibrium, average total costs are minimized.
In long-run equilibrium, the firm is earning economic profits. 

2.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

Which of the following market structures results in allocative efficiency? 
Monopoly
Monopolistic Competition
Perfect Competition
Oligopoly

3.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

Which of the following is true of a monopolistically competitive firm in long-run equilibrium? 
Price equals marginal cost and average total cost. 
Price equals average total cost but is greater than marginal cost. 
Price equals marginal cost and is greater than average total cost. 
The firm earns positive economic profits by producing at minimum average cost. 

4.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

The demand curve for a monopolistically competitive firm is downward sloping because:

the products produced by different firms are not identical

there are a small number of firms in the market

the product is produced by using scarce resources

it is easy for firms to enter or exit the market

5.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

Media Image
The graph shows a monopolistically competitive firm:
making a profit in the short-run
incurring a loss in the short-run
making a profit in the long-run
breaking even in the long-run

6.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

Media Image
In the long-run, the ATC will be tangent to the demand curve at:
Q1
Q2
Q3
none of the above

7.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

A monopolistically competitive firm advertises in order to:
shift the demand curve for its product to the left 
make its product more similar to its competitors’ 
reduce the industry’ s barriers to entry 
make the demand for its product less price elastic 

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