The Diagram Below Shows Selected Cost and Revenue Curves for a Firm

Multiple Choice

The diagram below shows selected cost and revenue curves for a firm in a monopolistically competitive industry. FIGURE 11-1
-Refer to Figure 11-1.Which of the following statements best describes the long-run equilibrium for this firm?

A) New firms will enter,causing this firm's demand curve to shift to the left until its profits are eliminated.
B) The firm will continue to earn its existing level of profits.
C) The firm will continue to earn its existing level of profits because it can prevent the entry of new firms to the market.
D) Firms with similar cost structures will exit the industry until profits are zero.
E) The AC curve will shift down in the long run and profits for this particular firm will increase.