1a) which of these is a key difference between a perfectly competitive firm and

ID: 1114290 • Letter: 1

Question

1a) which of these is a key difference between a perfectly competitive firm and a monopolist that does not practice price discrimination?

a.the marginal cost curve is u-shaped for a perfectly competitive firm but not for a monopolist

b.price is equal to average revenue for a perfectly competitive firm in equilibrium but not for a monopolist

c.price is equal to marginal revenue for a perfectly competitive firm in equilibrium but not for a monopolist

d.the average revenue curve is the demand curve for a perfectly competitive firm but not for a monopolist

e.a monopolist aims to maximize profits, while a perfectly competitive for, tries to maximize total revenue

1b)the demand curve facing a non-discriminating monopolist:

a. is the same as its average revenue curve

b.is perfectly price elastic

c. is perfectly price inelastic

d. lies above its average revenue curve

e.lies below its marginal revenue curve

1c)in long-run equilibrium, a monopolistically competitive firm will produce:

a. at its minimum average cost

b. at full capacity

c.along the downward-sloping portion of its ATC curve

d. along the upward-sloping portion of its ATC curve

e.at the minimum point of its marginal cost curve

Answer.)

1a.) c.price is equal to marginal revenue for a perfectly competitive firm in equilibrium but not for a monopolist

a monopolist equals its price to its Avergae revenure curve.

1b.) a. is the same as its average revenue curve

1c.) a. at its minimum average cost

in long-run equilibrium a monopolistically competitive firm will produce at the level in which price equals its minimum of long-run average cost.

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