Which of the following statements regarding monopolistic competition is FALSE?
A) Resources are used efficiently when marginal social benefit equals marginal social cost.
B) A greater degree of product variety creates a loss because the quantity produced is less than the efficient quantity.
C) Monopolistic competition is definitely inefficient because price exceeds marginal cost.
D) Compared to a situation with total product uniformity,monopolist competition might be efficient.
E) A firm in monopolistic competition produces a quantity that is less than the efficient scale.
Correct Answer:
Verified
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