When a firm exits a monopolistically competitive market, the individual demand curves faced by all remaining firms in that market will
A)shift in a direction that is unpredictable without further information.
B)shift to the right.
C)shift to the left.
D)remain unchanged. It is the supply curve that will shift.

Question

Quizplus · Accepted Answer

When a firm exits a monopolistically competitive market, the demand faced by the remaining firms increases as there are fewer substitutes available, causing the individual demand curves to shift to the right.

When a Firm Exits a Monopolistically Competitive Market, the Individual