Why Do Most Firms in Monopolistic Competition Typically Make Zero

question 238

Multiple Choice

Why do most firms in monopolistic competition typically make zero profit in the long run?

• A)because firms produce differentiated products
• B)because the lack of entry barriers would compete away profits
• C)because firms do not produce at their minimum efficient scale
• D)because the total market is not large enough to accommodate so many firms

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Definitions:

Identifying Information

Data or details that can be used to recognize or distinguish an individual, such as name, age, or Social Security Number.

Specified Objectives

Clearly defined goals or targets that are intended to be achieved within a specific timeframe.

Written Contracts

Formal agreements documented in writing that specify the terms and obligations between parties.

Pressured

Feeling subjected to persistent urgency or stress, often from external demands or expectations.