The monopolistic competitive firm will most likely earn a normal profit in the long run because of
A)product differentiation.
B)many buyers and sellers.
C)easy entry and exit.
D)b and c

Question

Quizplus · Accepted Answer

Easy entry and exit in the market ensures that in the long run, firms in monopolistic competition will earn normal profits. When firms earn above-normal profits, new firms are attracted to the market, increasing competition and driving profits down to normal levels.

The Monopolistic Competitive Firm Will Most Likely Earn a Normal