A downward-sloping demand curve
A)is a feature of all monopolistically competitive firms.
B)means that the firm in question will never experience a zero profit.
C)causes marginal revenue to exceed price.
D)prohibits firms from earning positive economic profits in the long run.

Question

Quizplus · Accepted Answer

In monopolistic competition, firms have some market power due to product differentiation, leading to a downward-sloping demand curve. However, in the long run, firms can earn zero economic profit due to the entry of new firms.

A Downward-Sloping Demand Curve