Refer to Scenario 14.2. If each unit of output sells for 5, how many days of labor will the firm hire to maximize profit?
A) 1
B) 2
C) 3
D) 4
E) 5
Question 2
What condition may provide for a relatively small degree of inefficiency under monopolistic competition?
A) There is a single seller and no product differentiation.
B) The marginal cost of production is less than the market price.
C) The demand curve is relatively elastic so that the price is near the long-run minimum average cost.
D) There is only one buyer in the market.
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