If a firm in a monopolistically competitive market has a demand curve that is shifting to the right,it will only stop shifting when:
A) the firm is earning zero economic profits.
B) the firm's price is equal to its average total costs.
C) other firms have no incentive to leave the market.
D) All of these statements are true.

Question

Quizplus · Accepted Answer

In a monopolistically competitive market, the demand curve shifts right until the firm earns zero economic profits, price equals average total costs, and other firms have no incentive to leave the market, making all statements true.

If a Firm in a Monopolistically Competitive Market Has a Demand