In Monopolistic Competition, Free Entry and Free Exit Mean That

question 155

True/False

In monopolistic competition, free entry and free exit mean that in the long run firms in the industry make zero economic profit.

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Definitions:

Salvage Recovered

The estimated value or amount that can be recovered from an asset at the end of its useful life through sale or recycling.

Investment Required

The amount of capital needed to undertake a specific project, purchase assets, or start a business.

Simple Rate

A basic or straightforward interest rate that does not take into account the effect of compounding.

Annual Incremental

Relates to the yearly increase or addition in terms of quantity, size, rate, or level of company metrics or budgets.