In the long run, all resources are fixed.

Price elasticity of demand is also known as the slope of the demand curve.

Oligopolists, like monopolists, can arise for similar reasons, such as economies of scale or government regulations.

When consumers have perfect information, they will spend a lot of time shopping at different stores and perusing newspaper and magazine articles to learn about the prices and qualities of products.

A brand new store, Billy’s Boards, opens and business takes off. We would expect:

In monopolistic competition, because of product differentiation the firm can make a profit in the long-run.

As competitors enter and provide substitutes, competition increases.

Creative destruction harms workers in activities that become obsolete or inefficient.

When consumers do not differentiate between products offered by different sellers, the product turns into a “commodity”.

If rival firms can do the same thing, economic profit will be driven to zero.