In Theory,in the Long Run,monopolistically Competitive Firms Earn Zero Profits

question 40

Multiple Choice

In theory,in the long run,monopolistically competitive firms earn zero profits.However,in reality,there are some ways by which a firm can avoid losing profits.Which of the following is one such way?

• A) Gradually increase the markup on the goods produced
• B) Lower the price of its products to expand its market share
• C) Identify new markets and develop products precisely for those markets
• D) Find a market niche and keep it as narrow as possible so as to prevent other producers from entering this market segment

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Definitions:

Little League

A youth sports organization in the United States that organizes local baseball and softball leagues for children.

Primary groups

Small social groups whose members share close, personal, and enduring relationships, often characterized by long-term emotional ties and support.

Strong sense

The robust understanding or perception of something, implying a deep and confident knowledge or conviction.

Specific roles

Specific roles refer to the distinct functions or responsibilities assigned to individuals or groups in a social, professional, or organizational context.