In the long run, monopolistic competition
A) results in a monopoly
B) ends up with one firm, that is, competition transforms to monopoly
C) ends up with many firms in the industry
D) has zero barriers to entry
E) has no product differentiation

Question

Quizplus · Accepted Answer

In the long run, monopolistic competition results in many firms in the industry due to low barriers to entry, allowing new firms to enter and compete, leading to normal profits and product differentiation.

In the Long Run, Monopolistic Competition