When a market is monopolistically competitive,what is the typical firm in the market likely to experience in the short and long run

Question

Quizplus · Accepted Answer

In the short run, a monopolistically competitive firm can experience either positive or negative profits depending on factors such as demand, competition, and costs. However, in the long run, new firms are likely to enter the market, making it more competitive and driving profits to zero. Therefore, the typical firm in a monopolistically competitive market is likely to experience positive or negative profits in the short run, but zero profits in the long run.

When a Market Is Monopolistically Competitive,what Is the Typical Firm