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EXCESS CAPACITY: A condition that exists when monopolistic competition achieves long-run equilibrium such that production by each firm is less than minimum efficient scale. The implication of this condition is that each firm is not producing up to its fullest capacity, as would be the case under perfect competition, and thus more firms are need to produce total market output compared to perfect competition. Excess capacity results because market control means a monopolistically competitive firm faces a negatively-sloped demand curve. Long-run equilibrium is thus achieved by the tangency of the negatively-sloped demand curve and the long-run average cost curve, which results in economies to scale.
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NUMBER OF SELLERS, SUPPLY DETERMINANT The number of sellers willing and able to sell a good, which is assumed constant when a supply curve is constructed. The number of sellers is one of five supply determinants that shift the supply curve when they change. The other four are resource prices, production technology, other prices, and sellers' expectations.
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YELLOW CHIPPEROON
[What's This?]
Today, you are likely to spend a great deal of time searching for a specialty store looking to buy either a wall poster commemorating last Friday (you know why) or a country wreathe. Be on the lookout for telephone calls from long-lost relatives.
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This isn't me! What am I?
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The 22.6% decline in stock prices on October 19, 1987 was larger than the infamous 12.8% decline on October 29, 1929.
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"Every man must decide whether he will walk in the light of creative altruism or in the darkness of destructive selfishness." -- Martin Luther King, Jr., clergyman
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NI
National Income, Net Income
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