What is the long-run effect on the demand curve of a monopolistically competitive firm when more firms enter the market?
A)Demand curve shifts to left.
B)Demand curve remains the same.
C)Demand curve shifts to right.
D)Demand curve become flatter.

Question

Quizplus · Accepted Answer

When more firms enter a monopolistically competitive market, the demand for each existing firm's product decreases as consumers have more choices, causing the demand curve to shift to the left.

What Is the Long-Run Effect on the Demand Curve of a Monopolistically