In the long run, a monopolistically competitive firm's demand curve becomes more elastic and shifts to the left

Name: In the long run, a monopolistically competitive firm's demand curve becomes more elastic and shifts to the left
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Question

​In the long run, a monopolistically competitive firm's demand curve becomes more elastic and shifts to the left

Quizplus · Accepted Answer

In the long run, new firms enter the market due to the presence of economic profits, increasing competition. This makes the demand curve for each firm more elastic and shifts it to the left as consumers have more substitutes to choose from.

​In the Long Run, a Monopolistically Competitive Firm's Demand Curve

In the Long Run, a Monopolistically Competitive Firm's Demand Curve