Author Question: A price-taking firm and a monopoly firm are alike in that: a. price equals marginal revenue for ... (Read 88 times)

rachel9 · **on:** Jun 30, 2018

A price-taking firm and a monopoly firm are alike in that:
a. price equals marginal revenue for both.
b. both maximize profits by choosing an output where marginal revenue equals marginal cost.
c. price exceeds marginal cost at the profit-maximizing level of output for both.
d. in the long run, both earn zero economic profits.

Question 2

Nascent industries require adequate protection from foreign competition because:
a. they experience economies of scale at the initial stages of production.
b. they experience diseconomies of scale at high levels of output.
c. the quality of the products of such industries are comparatively inferior than the products of their foreign competitors.
d. they could undermine other developed industries by selling higher quality products at lower prices.
e. their initial costs of production are considerably high and they incur losses.