Figure 8.3
-Figure 8.3 shows demands and costs for a monopolistically competitive firm. When the firmʹs demand curve shifts from D1 to D2 and to D3, in the long-run we would expect:

Question

Quizplus · Accepted Answer

In the long run, monopolistically competitive firms earn zero economic profit due to the entry of new firms, which shifts the demand curve until price equals average total cost.

Figure 8.3 -Figure 8.3 Shows Demands and Costs for a Monopolistically Competitive