Asked by Johana Madrid on May 16, 2024

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The economic profits earned by monopolistically competitive sellers are zero in the long run.

Economic Profits

The difference between total revenue and total costs, including both explicit and implicit costs, representing the excess that remains after all costs have been accounted for.

Monopolistically Competitive

Describes a market structure where many companies sell products that are similar but not identical, allowing for competition based on factors other than price, such as quality and branding.

  • Get a grip on the variety of market schemes, such as monopoly, oligopoly, monopolistic competition, and flawless competition.
  • Appraise the extended economic results for organizations in diverse market environments.
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JF
Justin FloydMay 22, 2024
Final Answer :
True
Explanation :
In the long run, monopolistically competitive sellers will face competition from similar products and will need to lower their prices and increase their product differentiation to maintain market share. As a result, in the long run, economic profits will be driven to zero.