The entry of an additional firm into a market shifts the demand curve for the original firm to the left.

Name: The entry of an additional firm into a market shifts the demand curve for the original firm to the left.
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Question

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When an additional firm enters a market, it increases the competition for the original firm. As a result, the demand for the original firm's products or services decreases, causing a leftward shift in the demand curve.

The Entry of an Additional Firm into a Market Shifts