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Social Science Clinic => Economics => Topic started by: imanialler on Apr 19, 2019

Title: If firms in a monopolistically competitive industry are earning economic profits, then in the long run
Post by: imanialler on Apr 19, 2019

If firms in a monopolistically competitive industry are earning economic profits, then in the long run

◦ these firms can continue earning economic profits because entry into the industry is blocked.
◦ new firms producing close substitutes will enter the industry and this entry will continue until economic profits are eliminated.
◦ new firms producing the exact same product will enter the industry and this entry will continue until economic profits are eliminated.
◦ the government will most likely regulate firms in this industry to reduce these economic profits.

Title: If firms in a monopolistically competitive industry are earning economic profits, then in the long run
Post by: blakeserpa on Apr 19, 2019

new firms producing close substitutes will enter the industry and this entry will continue until economic profits are eliminated.

Title: If firms in a monopolistically competitive industry are earning economic profits, then in the long run
Post by: imanialler on Apr 19, 2019

TY

Title: If firms in a monopolistically competitive industry are earning economic profits, then in the long run
Post by: blakeserpa on Apr 19, 2019

You're welcome