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Chapter 16 Monopolistic Competition TRUE/FALSE 1. The competition in monopolistically competitive markets is most likely a result of having many sellers in the market. ANS: T DIF: 1 REF: 16-1 NAT: Analytic LOC: Monopolistic competition TOP: Monopolistic competition MSC: Interpretive 2. The monopoly in monopolistically competitive markets is most likely a result of firms having some pricing power due to product differentiation. ANS: T DIF: 1 REF: 16-1 NAT: Analytic LOC: Monopolistic competition TOP: Monopolistic competition MSC: Interpretive 3. Monopolistic competition is characterized by many buyers and sellers, product differentiation, and free entry. ANS: T DIF: 1 REF: 16-1 NAT: Analytic LOC: Monopolistic competition TOP: Monopolistic competition MSC: Definitional 4. Monopolistic competition is characterized by many buyers and sellers, product differentiation, and barriers to entry. ANS: F DIF: 1 REF: 16-1 NAT: Analytic LOC: Monopolistic competition TOP: Monopolistic competition MSC: Definitional 5. A monopolistically competitive market is characterized by barriers to entry. ANS: F DIF: 1 REF: 16-1 NAT: Analytic LOC: Monopolistic competition TOP: Monopolistic competition MSC: Interpretive 6. Monopolistic competition is the only market structure that features many sellers. ANS: F DIF: 1 REF: 16-1 NAT: Analytic LOC: Monopolistic competition TOP: Markets
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