Monopolistic Competition and perfect competition differ because

A.only monopolistic competition allows for entry of other firms in the long run.

B.only competitive firms take the price as given.

C.only perfectly competitive firms will set MR = MC.

D.only monopolistically competitive firms will set MR = MC.

Suppose a market with a Cournot structure has five firms and a market price elasticity of demand equal to -2. What is a Cournot firm's Lerner Index? (Hint: a Cournot firm's Lerner Index = market share * monopolist's Lerner Index)

A.0.1

B.1

C.0.5

D.0.2

The number of firms in a monopolistically competitive market will be smaller if

A.fixed costs are smaller.

B.the market demand curve shifts rightward.

C.fixed costs are larger.

D.minimum efficient scale is lower.

Suppose mountain spring water can be produced at no cost and that the demand curves for mountain spring water are given as follows:

Q = 6000 - 4P

What will be the price in the long run if the industry is a Cournot duopoly?

A.$400

B.$700

C.$600

D.$500

A group price discriminator sells its product in Florida for three times the price it sets in New York. Assuming the firm faces the same constant marginal cost in each market and the price elasticity of demand in Florida is -1.4, the demand in NewYork

A.has an elasticity of -6.0.

B.has an elasticity of -0.67.

C.has an elasticity of -1.4.

D.has an elasticity of -7.0.