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If Monopolistically Competitive Firms Are Earning an Economic Profit, Then

Question 77

Multiple Choice

If monopolistically competitive firms are earning an economic profit, then over the long run firms will:


A) enter the market and the economic profit will be competed away.
B) enter the market, but the existing sellers will still be able to earn some economic profit.
C) not be able to enter the market, and existing sellers' abilities to earn economic profit will not be weakened.
D) leave the market because the economic profit will increase the intensity of competition, and with that, the risk of doing business.

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