Monopolistically competitive firms can earning positive economic profits in the short run, but in the long run:
a. the level of profits will be unchanged.
b. they will make zero economic profits.
c. firms will be unable to enter the industry because of the existence of barriers to entry.
d. a limited number of firms will enter the industry, and profits will be reduced but will remain positive.
Ans: b. they will make zero economic profits.
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