Question

multiple choice question
a(n) ______ is able to maintain an economic profit in the long run because there are no new entrants to increase supply, drive down price, and eliminate economic profit.

o monopolistically competitive firm
o perfectly competitive firm
o oligopolistic firm
o monopoly

Explanation:

In a monopoly, there are high barriers to entry preventing new firms from entering the market. This lack of competition allows the monopolist to maintain economic profit in the long - run. In monopolistic competition, firms earn zero economic profit in the long - run due to easy entry and exit. In perfect competition, there are many firms and free entry and exit, leading to zero economic profit in the long - run. In oligopoly, while there are barriers to entry, competition among the few firms can also limit long - run economic profit compared to a monopoly.

Answer:

monopoly