Question

For each of the following characteristics, indicate whether it describes a perfectly competitive firm, a monopolistically competitive firm, both, or neither. (Note: If the characteristic describes neither, leave the entire row unchecked.) Check all that apply.

Characteristic	Perfectly Competitive	Monopolistically Competitive
Sells a product identical to that of its competitors
Can earn economic profit in the short run
Produces above the minimum of average total cost in the long run
Charges a price that is the same as marginal cost
Produces welfare-maximizing level of output
Has marginal revenue less than price

Answer 1