Homework Answers
Answer: Option d) There are high barriers to entry in monopolistic competition.
Explanation:
When there are high barriers to entry in monopolistic competition there is a monopolistic firms can earn positive economic profits in the long run.
If the new monopolistic enters and exists easily and the continuous process of new monopolists enters in the market then reducing the original firm's demand.
In the market more of the firm's produces and sells a homogeneous products then in the market competition is very high.
The competitive firm will be earn positive profits in short run and other firm's will be earn long run profits.
Thus option d) is correct and remaining given options are incorrect.
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