Asked by Austin Husmann on May 28, 2024

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(Figure: Monopolistic Competition V) Use Figure: Monopolistic Competition V.The figure illustrates a firm in the _____;in the _____,the demand and marginal revenue curves will shift to the _____.

A) short run;long run;right
B) long run;short run;left
C) short run;long run;left
D) long run;short run;right

Marginal Revenue

The additional income received from selling one more unit of a good or service.

Demand Curve

A graphical representation demonstrating the relationship between the price of a good and the quantity of that good consumers are willing and able to purchase at various prices.

Short Run

A period in economic analysis where some factors of production are fixed and cannot be changed.

  • Learn about the effects that the entry and departure of businesses have on the structure of monopolistically competitive markets and on the firms operating within them.
  • Describe the impact of changes in market demand on prices, output, and profits in the short and long run.
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LP
Leywes PierreMay 29, 2024
Final Answer :
C
Explanation :
The figure illustrates a firm in the short run of monopolistic competition. In the long run, due to the presence of entry and exit, the demand and marginal revenue curves will shift to the left, leading to a decrease in profit. Therefore, the best choice is C, where the firm is in the short run and the demand and marginal revenue curves will shift to the left in the long run.