If firms in a monopolistically competitive industry are incurring losses, in the long run
A. firms will leave this industry until the firms that remain are earning a positive economic profit.
B. investment in this industry will increase to reduce production costs.
C. firms will leave this industry until the remaining firms are earning a normal profit.
D. the government will subsidize the losses incurred by these firms so as to maintain competition in the industry.
Answer: C
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