Decide whether each of the following statements is true or false for each of three different types of market: perfect competition, monopoly, and monopolistic competition. a. Firms equate price and marginal cost. b. Firms equate marginal revenue and marginal cost. c. Firms earn economic profits in the long run. d. Firms produce the quantity that minimizes long-run average cost. e. New firms are free to enter this industry.

Respuesta :

Answer:

THE ANSWERS ARE BELOW:

Explanation:

a. Firms equate price and marginal cost

Perfect competition: TRUE

Monopoly: False

Monopoly competition: false

b. Firms equate marginal revenue and marginal cost.

Perfect competition: TRUE

Monopoly: TRUE

Monopoly competition: TRUE

c. Firms earn economic profits in the long run

Perfect competition: FALSE

Monopoly: TRUE

Monopoly competition: FALSE

d. Firms produce the quantity that minimizes long-run average cost.

Perfect competition: TRUE

Monopoly: FALSE

Monopoly competition: FALSE

e. New firms are free to enter this industry.

Perfect competition: TRUE

Monopoly: FALSE

Monopoly competition: TRUE