Because economic profits are eliminated in the long run in monopolistic competition,to make an economic profit,firms continuously
A) shut down.
B) exit the industry.
C) develop and market new products.
D) declare bankruptcy.
E) decrease their costs by decreasing their selling costs.

Question

Quizplus · Accepted Answer

In monopolistic competition, firms have some degree of market power due to differentiated products, but there are also many other firms in the industry selling similar products. As a result, economic profits are eliminated in the long run as new firms enter and existing firms adjust their prices and products. To make an economic profit, firms can continuously develop and market new products to maintain their differentiation and stay ahead of competitors. This may involve investing in research and development or adapting to changing consumer preferences.

Because Economic Profits Are Eliminated in the Long Run in Monopolistic