A monopolistically competitive firm earning profits in the short run will find the demand for its product becoming more elastic in the long run because: 1more substitutes are available because new rivals have entered the market. 2the price of the product relative to buyers' incomes has increased. 3consumers have tired of the firm's product. 4consumers incomes have fallen.

1) more substitutes are available because new rivals have entered the market.

Answered: A monopolistically competitive firm…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Question

A monopolistically competitive firm earning profits in the short run will find the demand for its product becoming more elastic in the long run because:

	1	more substitutes are available because new rivals have entered the market.
	2	the price of the product relative to buyers' incomes has increased.
	3	consumers have tired of the firm's product.
	4	consumers incomes have fallen.

Expert Solution

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions