Author Question: Firms in monopolistic competition always will A) make an economic profit. B) set their price ... (Read 59 times)

moongchi · **on:** Jun 29, 2018

Firms in monopolistic competition always will

A) make an economic profit.
B) set their price equal to their marginal cost.
C) set their price above their marginal cost.
D) produce at the minimum average total cost.

Question 2

Two duopoly firms form a cartel. They decide to collude and fix the price of their good. Each individual firm will earn the highest profit if

A) it cheats and the other sticks with the agreement.
B) both stick with the agreement.
C) it sticks with the agreement and the other cheats.
D) they both cheat.