In the short run,a monopolistic competitor can
A)not earn an economic profit because of competition
B)use limit pricing to reduce competition
C)maximize profits by charging the highest price the market will bear
D)earn an economic profit
E)maximize profit by selecting the minimum efficient scale

Question

Quizplus · Accepted Answer

In the short run, a monopolistic competitor can earn an economic profit because they have some degree of market power due to product differentiation, allowing them to set prices above marginal cost.

In the Short Run,a Monopolistic Competitor Can