Use the following to answer question:
Figure: Monopolistic Competition VI
-(Figure: Monopolistic Competition VI)Use Figure: Monopolistic Competition VI.The figure illustrates a firm in the _____;in the _____,the demand and marginal revenue curves will shift to the _____.
A)short run;long run;right
B)long run;short run;left
C)short run;long run;left
D)long run;short run;right

Question

Use the following to answer question:
Figure: Monopolistic Competition VI 
-(Figure: Monopolistic Competition VI)Use Figure: Monopolistic Competition VI.The figure illustrates a firm in the _____;in the _____,the demand and marginal revenue curves will shift to the _____.
A)short run;long run;right 
B)long run;short run;left 
C)short run;long run;left 
D)long run;short run;right

Quizplus · Accepted Answer

In the short run, a firm in monopolistic competition faces a downward-sloping demand curve. In the long run, however, new firms will enter the market, causing the demand curve for each firm to shift to the left.

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