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Question
If monopolistically competitive firms are incurring losses, existing firms would
a. reduce their costs.
b. charge higher prices.
c. make demand more inelastic.
d. leave the industry.
e. begin to collude illegally.
Answer
This answer is hidden. It contains 38 characters.
Related questions
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The economic entity most likely to engage in price gouging is
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What will an individual do differently as a buyer in the black market in the long run?
a. He or she will substitute away from the product.
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What is the long-run consequence of a price ceiling law?
a. A surplus will continue to exist and will grow larger over time.
b. A surplus will continue to exist and will grow smaller over time.
c. A shortage will continue to exist and will grow larger over time.
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Q:
Suppose Solomon lives in a community with no price controls. What do you expect will happen if his town borders a community where there is a binding price ceiling on most products?
a. Prices in the legal market in the community with a binding price ceiling will rise.
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