Question

1)

Which of the following is an assumption of monopolistic competition?

Group of answer choices

a There are no barriers to entry

b Each seller produces a similar, but different good

c There is a single seller

d The actions of one seller will affect the actions of the others

2)

Suppose a price-taking firm has total fixed costs of $200 and the following marginal costs:

Quantity	1	2	3	4	5	6	7
MC	50	30	60	80	100	140	200

      

If the market price of the good is $140, how much profit will this firm earn?

Group of answer choices

a $180

b $60

c $500

d $640

Answer 1

1) Here, option D is correct that is the actions of one seller will affect the actions of others.

Because,In oligopoly marker, there is many number of buyers but only few number of sellers.
There is product differentiation in this market and in this market, the actions of one firms is affected by the other firm's actions.

So, option D.

2) option A

Ques / Q МС TEC 200 -ТО 250 2 VC so 80 140 220 203 . 3 - 200 200 TR LYO 280 420 Sъо Zoo 890 960 30 66 fo 100 14o 200 4 280 340 420 520 (60 860 200 5 6 그 yco 200 200 660 nice = 140 profit it max. MR =Mc = 140 So, Q = 6 Total profit ? TR - Teat 840-660 =180 026 = 180 loption (A) =