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Suppose that firms in a monopolistically competitive industry are making positive profits in the short run.
Select the correct answers below to describe what will happen in this industry in the long run.
Since profits are greater than zero, (Click to select)firms will enter the number of firms will not changefirms will exit.
As this occurs, demand for each firm will (Click to select)increasestay the samedecrease.
This will continue until (Click to select)profits increaseprofits equal zeroprofits decrease.
At this point, (Click to select)P = MCP = MRP = ATC.
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