Refer to the Information Provided in Figure 15

question 188

Multiple Choice

Refer to the information provided in Figure 15.3 below to answer the question(s) that follow. Figure 15.3
-Refer to Figure 15.3. In the long run, this monopolistic competitive firm should expect

• A) nothing to change; it will continue to make a profit.
• B) firms to exit the industry and profits to increase.
• C) firms to enter the industry until all economic profits are eliminated.
• D) firms to enter the industry and profits to increase.

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Definitions:

Monopolistically Competitive

A market structure characterized by many firms selling similar but not identical products, with some degree of market power.

Total Broccoli Output

The aggregate amount of broccoli produced over a specified period of time.

Long-Run Equilibrium

A state in which all factors of production and outputs in an economy are fully adjusted to any changes in demand and supply, resulting in economic stability.

Perfect Competition

A market structure characterized by many buyers and sellers, identical products, and no barriers to entry or exit.