ECONOMICS 2302 Topic 11 Monopolistic Competition and Oligopoly.

1. The graphs shows the marginal cost (MC) and the average total cost (ATC) curves for a typical
firm competing in the monopolistically competitive market for frozen foods.




The long – run equilibrium would occur at an output level of _______ thousand cases and price
would be ______
4/6.5
2. In a monopolistically competitive market, the closer the substitutes are each other, the
________ elastic each firm’s demand curve will be.
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3. Monopolistically competitive markets:
Combine characteristics of competitive markets and pure monopolies
4. The characteristics of an oligopoly competitive market are:
 Producers who behave strategically when making decisions related to the features,
prices, and advertising of their products
 A few large producers
 Either standardized or differentiated products
 Operations in industries with extensive entry barriers
 Producers who are price makers




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