Which of the following situations arises when the market type is monopolistic competition?

Question

Accepted Answer

Firms can freely enter and exit, so economic profit is zero in the long run.

Answer

Barriers to entry and exit make economic profit positive in the long run.

Answer

Firms can freely enter and exit, so economic profit is positive in the long run.

Answer

Barriers to entry and exit make economic profit zero in the long run.

Answer

Firms can freely enter and exit so economic profit is never positive.

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