What one good thing happens when a monopolistically competitive firm lowers it price?
A)The output effect
B)The price effect
C)The income effect
D)The substitution effect

Question

Quizplus · Accepted Answer

When a monopolistically competitive firm lowers its price, the output effect is the good thing that happens. This means that the firm's sales will increase as the lower price makes their product more appealing to consumers, resulting in an increase in revenue.

What One Good Thing Happens When a Monopolistically Competitive Firm