Answer
a) monopolistic competition
b) monopolistic competition
c) neither
d) perfectly competitive
e) both
f) monopolistic competition
Work Step by Step
a) In a monopolistic competition, the product is differentiated from those of its competitors. (In a perfect competition, the product is identical to those of its competitors.)
b) Monopolistic competition has the marginal revenue less than price.
c) Neither monopolistic competition nor perfect competition allow an economic profit in the long run.
d) In a perfect competition, the firms produce at the minimum point on the average total cost curve. In a monopolistic competition, the minimum of the average total cost curve shows the efficient quantity (not the actual quantity produced).
e) In both a monopolistic competition and a perfect competition, the marginal revenue is the same as the marginal cost.
f) Only in a monopolistic competition would there be a price charged above the marginal cost.
