General Snacks Is a Typical Firm in a Market Characterized

question 215

Multiple Choice

General Snacks is a typical firm in a market characterized by the model of monopolistic competition.Initially,the market is initially in long-run equilibrium,and then there is an increase in the market demand for snacks.We expect that:

• A)in the long run,new firms will enter the market.
• B)there will be a short-run increase in the number of firms,but in the long run,the number of firms will return to the original level.
• C)firms will leave the market in the long run.
• D)firms will shut down,but they will not leave the industry in the long run.