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One Source of Inefficiency in Monopolistic Competition Is That

Question 32

Multiple Choice

One source of inefficiency in monopolistic competition is that


A) Since price is above marginal cost, surplus is redistributed from buyers to sellers.
B) Monopolistically competitive firms earn economic profits in the long run.
C) Monopolistically competitive firms produce beyond their efficient scale.
D) Since price is above marginal cost, some units are not produced that buyer's value in Excess of the cost of production and this causes a deadweight loss.

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