In the Long-Run Equilibrium in a Monopolistically Competitive Industry, Economic

question 30

Multiple Choice

In the long-run equilibrium in a monopolistically competitive industry, economic profits are _________ due to __________.

• A)positive; free entry into the industry.
• B)zero; monopoly power.
• C)positive; barriers to entry into the industry.
• D)zero; free entry into the industry.

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Definitions:

Net Present Value Rule

A financial metric for evaluating the profitability of an investment, measuring the difference between the present value of cash inflows and the present value of cash outflows over time.

Creates Value

Generally refers to actions or processes that increase the worth of a product, service, or company to stakeholders.

Owners

Individuals or entities that possess legal title or right to a property or asset.