« previous next »

Author Question: A monopoly firm can make economic profit in the long run. A firm in monopolistic competition cannot. ... (Read 93 times)

123654777

  • Hero Member
  • *****
  • Posts: 585
on: Jun 29, 2018
A monopoly firm can make economic profit in the long run. A firm in monopolistic competition cannot. What creates this difference?
 
  What will be an ideal response?

Question 2

Jane spends her monthly dining-out budget of 300.00 on either steak or lobster dinners. Using the above figure, what is the opportunity cost of a lobster dinner in terms of steak dinners?
 
  A) 0.5 steak dinners per lobster dinner
  B) 2.0 steak dinners per lobster dinner
  C) 5.0 steak dinners per lobster dinner
  D) 10.0 steak dinners per lobster dinner


coreycathey

  • Sr. Member
  • ****
  • Posts: 333
Reply #1 on: Jun 29, 2018
Answer to Question 1

The key to long-run economic profits is a barrier to entry. The monopoly firm has a barrier to entry that protects its economic profit from the entry of new firms. A monopolistically competitive firm's industry features easy entry and exit and so there is nothing to protect any economic profit.

Answer to Question 2

B


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

The eye muscles are the most active muscles in the whole body. The external muscles that move the eyes are the strongest muscles in the human body for the job they have to do. They are 100 times more powerful than they need to be.

Did you know?

The toxic levels for lithium carbonate are close to the therapeutic levels. Signs of toxicity include fine hand tremor, polyuria, mild thirst, nausea, general discomfort, diarrhea, vomiting, drowsiness, muscular weakness, lack of coordination, ataxia, giddiness, tinnitus, and blurred vision.

Did you know?

Certain chemicals, after ingestion, can be converted by the body into cyanide. Most of these chemicals have been removed from the market, but some old nail polish remover, solvents, and plastics manufacturing solutions can contain these substances.

Did you know?

The first monoclonal antibodies were made exclusively from mouse cells. Some are now fully human, which means they are likely to be safer and may be more effective than older monoclonal antibodies.

Did you know?

The heart is located in the center of the chest, with part of it tipped slightly so that it taps against the left side of the chest.

Associative Long-Term Potentiation Associative Long-Term Potentiation
A long, narrow cobbled street in Old San Juan. A long, narrow cobbled street in Old San Juan.
economic question economic question
economic question economic question
economic question economic question
Video: Protein Structure - Primary, Secondary, Tertiary and Quaternary

For a complete list of videos, visit our video library