If the firms in a monopolistically competitive market are earning short-run economic profits,then
A) each existing firm will increase output in the long run as its marginal revenue curve shifts rightward
B) each firm will experience an increase in the demand for its output in the long run
C) each firm's profit will drop to normal in the long run as its demand curve shifts leftward due to entry of new firms
D) barriers to entry will enable them to earn economic profits in the long run
E) decreased demand for a key input will reduce that input's price in the long run and lower each firm's average total cost curve
Correct Answer:
Verified
Q25: Q26: Q27: Q28: Q29: Q31: Q32: Q33: In monopolistic competition,nonprice competition Q34: Q35: Unlock this Answer For Free Now! View this answer and more for free by performing one of the following actions Scan the QR code to install the App and get 2 free unlocks Unlock quizzes for free by uploading documents![]()
![]()
![]()
![]()
![]()
![]()
![]()
A)allows firms to earn![]()
![]()