When the Loss from a Business-Stealing Externality Exceeds the Gain

Multiple Choice

When the loss from a business-stealing externality exceeds the gain from a product-variety externality,what do we expect will happen

A) Firms are more likely to operate at efficient scale.
B) There are likely to be too many firms in a monopolistically competitive market.
C) Market efficiency is likely to be enhanced by the entry of new firms.
D) The market structure is likely to be in transition.