Suppose Toor's beer is sold in a monopolistically competitive market. If the price of Toor's is currently $2 and the average cost of producing Toor's is $1, in the long run we can expect:
A. the demand for Toor's beer to increase.
B. the price of Toor's beer to decrease, and the average cost of producing Toor's to increase.
C. the demand curve for Toor's beer to become horizontal.
D. no change in the price or average cost of producing Toor's beer.
Answer: B
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