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In Theory, in the Long Run, Monopolistically Competitive Firms Earns

Question 52

Multiple Choice

In theory, in the long run, monopolistically competitive firms earns zero profits.However, in reality there are some ways by which a firm can avoid losing profits.Which of the following is one such way?


A) Gradually increase the markup on the goods produced
B) Lower the price of its products to expand its market share
C) Identify new markets and develop products precisely for those markets
D) Find a market niche and keep it as narrow as possible so as to prevent other producers from entering this market segment

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