Download Monopolistic Competition – Study Materials | ECON 200 and more Study notes Microeconomics in PDF only on Docsity! Monopolistic Competition A Monopolistic Competitor in the Long Run Entry occurs until P = ATC and profit = zero. Mark up = when the price at which a product is sold exceeds its marginal cost Is this firm achieving allocative efficiency? Is this firm achieving productive efficiency? Quantity Price ATC D MR Q MC MC P = ATC markup NBC’s Sunday Night Football is the most expensive show for advertisers with a 30-second spot costing over $500,000. What are the next most expensive shows? A. Family Guy is number 2 and Glee is number 3 B. American Idol is number 2 and Big Bang Theory is number 3 C. Shark Tank is number 2 and Undercover Boss is number 3 D. Modern Family is number 2 and New Girl is number 3 Fa m ily G uy is n um be r 2 .. . Am er ica n Id ol is n um be r.. Sh ar k T an k is nu m be r 2 a. . M od er n Fa m ily is n um be r.. 25% 25%25%25% Your company has recently requested that you travel to Dhaka, Bangladesh, to work on negotiations for a new factory to be located in one of the port cities. Your travel agent provides a list of several hundred local hotels, and a Sheraton. Which would you choose? A.I would choose a local hotel B. I would choose the Sheraton I w ou ld ch oo se a lo ca l h ot el I w ou ld ch oo se th e Sh er ... 50%50% Which of the following goods are likely to be sold in a monopolistically competitive market? A.Cookies B. Wheat C.Postage stamps D.Corn Co ok ie s W he at Po st ag e s ta m ps Co rn 25% 25%25%25% Under which of the following market structures would the highest output of a particular good be produced? A.Perfect competition B. Monopolistic competition C.Monopoly 10 Pe rfe ct co m pe tit io n M on op ol ist ic co m pe tit io n M on op ol y 33% 33%33% Under which of the following market structures would consumers likely pay the highest price for a product? A.Perfect competition B. Monopolistic competition C.Monopoly 11 Pe rfe ct co m pe tit io n M on op ol ist ic co m pe tit io n M on op ol y 33% 33%33%
