When Firms in Monopolistic Competition Make an Economic Profit

question 128

Multiple Choice

When firms in monopolistic competition make an economic profit,

• A)firms enter the industry,which increases demand for the product of the firms originally in the market.
• B)firms exit the industry,and demand increases for the products of the firms that remain.
• C)firms exit the industry,and demand decreases for the firms that remain in the industry.
• D)firms enter the industry,and demand decreases for the firms that were originally in the industry.
• E)eventually the market will become a monopoly.

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Definitions:

Corporate Brand

The overall identity of a corporation as perceived by its customers, including its logo, communication, and visual appearance.

New Brand

The process of creating a new identity, including name, symbols, and design, for a product or company to establish its presence in the market.

Subbranding

The strategy of creating a secondary brand within the main brand to cater to a different segment of the market or to differentiate products within the same category.

Multibranding

A marketing strategy where a company markets multiple brands within the same product category, catering to diverse customer preferences.