ANSWER QUESTIONS A TO E

a) The monopoly portion of the market structure "monopolistic competition" refers to , while the competition portion refers to O Differentiated products; barriers to entry 0 Differentiated products; free entry and exit 0 Identical products; barriers to entry 0 Identical products; free entry and exit b) Continue with part (a): What does the monopoly portion refer to? O The demand curve that a typical rm faces is negatively sloped 0 All of the answers are correct 0 Firms in the long run will earn zero economic prots 0 Because of brand loyalty, a rm can raise the price of its product without worrying about any of its customers will switch to buy other similar brands c) Suppose a monopolistically competitive rm has MC=4Q+5. Its demand is P=145-BQ and marginal revenue is MR=145-BQ. What is its prot-maximizing output level? 0 17 O14 O15 016 d) If the following numbers show the four-rm concentration ratio of a given industry, which industry is the least competitive? O 75 095 015 025 e) Which of the following is CORRECT about a Nash equilibrium? 0 Each rm produces at the output level where it does not have incentives to change 0 Each rm produces at the output level where ATC is at its minimum 0 Each rm produces at the output level where P=ATC 0 Each rm produces at the output level where prots are equal to zero