A monopolistically competitive industry that earns economic profits in the short run will
A) experience a rise in demand in the long run.
B) experience the entry of new rival firms into the industry in the long run.
C) experience the exit of existing firms out of the industry in the long run.
D) continue to earn economic profits in the long run.
Question 2
BHP Billiton is a Canadian company that owns mines in Canada that
A) produce nickel. After World War II, BHP Billiton began to compete with another Canadian firm, the International Nickel Company. This competition eventually ended International Nickel's monopoly in this market.
B) produce coal. Until World War II, BHP Billiton had a monopoly on coal in Canada.
C) produce bauxite, the mineral needed to produce aluminum. BHP Billiton began to mine bauxite after World War II. This competition eventually ended the Aluminum Company of America (ALCOA)'s monopoly in this market.
D) produce diamonds.
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