Asked by Football news With Scott and Lucas on Jun 03, 2024

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Industries that are made up of many competing producers,each selling a differentiated product,and whose firms earn zero economic profits in the long run are:

A) perfectly competitive.
B) monopolies.
C) oligopolies.
D) monopolistically competitive.

Zero Economic Profits

A situation where a firm's total revenues exactly equal its total costs, including opportunity costs, resulting in neither economic profit nor loss.

Monopolistically Competitive

Describes a market structure where many firms sell products or services that are similar but not identical, allowing for competition but also some level of pricing power.

  • Examine and differentiate between monopolistic competition and various other market structures.
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Verified Answer

EG
Erick GutierrezJun 05, 2024
Final Answer :
D
Explanation :
The description given in the question matches the characteristics of monopolistically competitive industries, in which multiple firms sell differentiated products, but there is still some degree of competition. In the long run, firms in monopolistically competitive industries earn zero economic profits due to the ease of entry and exit into the market. Therefore, choice D, monopolistically competitive, is the best answer.