Consider the following characteristics of a particular industry:
- there is freedom of entry and exit
- in long- run equilibrium, each firm is producing a level of output where there are increasing returns to scale
This industry is likely to be

Question

Quizplus · Accepted Answer

In a monopolistically competitive industry, firms have freedom of entry and exit, and in the long run, they may produce at a level where there are increasing returns to scale due to product differentiation and excess capacity.

Consider the Following Characteristics of a Particular Industry