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A Monopolistically Competitive Firm Differs from a Perfectly Competitive Firm

Question 44

Multiple Choice

A monopolistically competitive firm differs from a perfectly competitive firm in that a monopolistically competitive firm:


A) faces a downward-sloping demand curve for its product.
B) faces a horizontal demand curve at the market-clearing price.
C) is able to earn profits in the long run.
D) faces virtually no barriers to entry.

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