In monopolistic competition there is/are A) only one seller ...

[j.rubin]

In monopolistic competition there is/are
 
  A) only one seller who faces a downward-sloping demand curve.
  B) many sellers who each face a perfectly elastic demand curve.
  C) a few sellers who each face a downward-sloping demand curve.
  D) many sellers who each face a downward-sloping demand curve.

Question 2

Assume the market for cage-free eggs is perfectly competitive. All else equal, as more farmers choose to produce and sell cage-free eggs, what is likely to happen to the equilibrium price of the eggs and profits of these farmers in the long run?
 
  A) The equilibrium price is likely to remain unchanged and profits are likely to increase.
  B) The equilibrium price is likely to decrease and profits are likely to decrease.
  C) The equilibrium price is likely to increase and profits are likely to increase.
  D) The equilibrium price is likely to increase and profits are likely to remain unchanged.

[xiazhe]

Answer to Question 1

D

Answer to Question 2

B