Question: Explain what is different between firms in monopolistic competition and
Explain what is different between firms in monopolistic competition and firms in oligopoly? What does this difference mean for prices and quantities and for economic profit.
Answer to relevant QuestionsDraw a demand curve for a firm with market power. Portray the situation where the firm is earning economic profits. Now illustrate what occurs as entry occurs and rivals begin competing with that firm.Explain and demonstrate why cost-plus pricing is probably not the same as profit-maximizing pricing.Two networks are vying for dominance in the HDTV network, the United States and Europe. It has been said that the winner is likely to be determined by economies of scale in manufacturing televisions. Explain.Explain what the incentives of bondholders and stockholders are. Are they the same? How do they differ? Will a firm with no debt act differently than a firm with a significant amount of debt?A cost of capital figure for each of the firms is listed below. Explain what this figure means.Motorola...........11.6Hershey Foods..................................12.8Home Depot..........12.2Dillard Department ...
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