Monopolistic competition may lead to each of the following except

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Monopolistic competition does not lead to monopoly profits since there are many firms in the market producing differentiated products, which limits their market power and pricing ability. However, it can lead to some inefficiencies and over-differentiation as firms may spend resources on advertising and creating unnecessary product differentiation to attract customers. In the long run, firms in monopolistic competition tend to earn only normal profits, resulting in long-run break-even.

Monopolistic Competition May Lead to Each of the Following Except