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The Diagram Below Shows Demand and Cost Curves for a Monopolistically

Question 93

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The diagram below shows demand and cost curves for a monopolistically competitive firm.
The diagram below shows demand and cost curves for a monopolistically competitive firm. FIGURE 11- 3 -The demand curve facing a monopolistically competitive firm is quite elastic because A) of the possibility of entry of new firms. B) there are many close substitutes to the good the firm is producing. C) the industry is producing a homogeneous product. D) firms are not behaving strategically. E) goods that are complements to the good the firm is producing also have elastic demand curves. FIGURE 11- 3
-The demand curve facing a monopolistically competitive firm is quite elastic because


A) of the possibility of entry of new firms.
B) there are many close substitutes to the good the firm is producing.
C) the industry is producing a homogeneous product.
D) firms are not behaving strategically.
E) goods that are complements to the good the firm is producing also have elastic demand curves.

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