In the Short Run,a Monopolistically Competitive Firm Produces at the Optimal

question 164

Multiple Choice

In the short run,a monopolistically competitive firm produces at the optimal level of output and is earning positive economic profits.In the long run,the _____ of firms shifts the firm's demand and marginal revenue curves _____,which _____ the firm's level of output and _____ the price it can charge until price equals average total cost.

• A)entry;leftward,decreases;decreases
• B)entry;leftward,decreases;increases
• C)entry;downward,decreases;decreases
• D)exit;rightward,increases;increases

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