Author Question: Monopolistically competitive firms a. are guaranteed to earn short-run economic profit b. may earn ... (Read 93 times)

jazziefee · **on:** Jun 30, 2018

Monopolistically competitive firms
a. are guaranteed to earn short-run economic profit
b. may earn short-run economic profits, although long-run economic profit is typically zero
c. may earn economic profit both in the short run and in the long run
d. earn zero economic profit both in the short run and in the long run
e. can only earn an economic profit in the inelastic portion of their demand curves

Question 2

Susie spends more of October thinking about her Halloween costume than she spends thinking about a proposed law that will be on the November ballot. Which of the following is true?
a. This behavior is rational if she expects a greater benefit from the costume than from any possible effect her vote could have on the proposed law.
b. This behavior is rational if she is planning to spend the time from Halloween to Election Day thinking about the law.
c. This behavior is not rational because the law is more important than the costume.
d. In order for this behavior to be considered rational, it would have to be true that Susie is too ignorant to fully understand the law.
e. In order for this behavior to be considered rational, it would have to be true that Susie would not be affected by the law.