Which of the following most closely approximates the conditions of a monopolistically competitive market?
a. The market for Grade A eggs, which is characterized by a large number of firms producing a homogeneous product.
b. The restaurant industry, which is characterized by firms producing a differentiated product in a market with low entry barriers.
c. Local cable television service, where a licensed supplier competes with firms offering satellite service.
d. The market for jumbo aircraft, where one major domestic firm competes with one major foreign firm.
Question 2
The ____ is the absolute value of the slope of an indifference curve.
a. marginal rate of substitution
b. average rate of transitivity
c. relative rate of utility
d. marginal rate of transposition
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