If a firm in a monopolistically competitive market successfully uses advertising to decrease elasticity of demand for its product,

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If the firm successfully uses advertising to decrease elasticity of demand for its product, it can sell more units at a higher price, giving them more market power. This allows them to increase their markup over marginal cost, which can increase profits. However, this may only be possible in the short run, as competitors may also start advertising to decrease elasticity of demand, leading to price competition and lower profits in the long run.

If a Firm in a Monopolistically Competitive Market Successfully Uses