Question

multiple choice question
what will happen to a monopolistically competitive firm in the long run?
o it will only break even.
o it will be forced to leave a profitable industry.
o it will fail to cover both implicit and explicit costs.
o it will become a monopoly.

Explanation:

In the long - run, new firms enter a monopolistically competitive industry if there are short - run profits and existing firms exit if there are losses. This process continues until firms in the industry only break even, where total revenue equals total cost. There is free entry and exit in monopolistic competition, so firms cannot sustain positive or negative economic profits in the long - run.

Answer:

It will only break even.