单选题 When a firm is earning positive economic profits in a monopolistic competitive market, what will most likely occur?

A. New firms will enter driving down the economic profits to zero.
B. Losses will occur in the short run.
C. Price takers will be over run by price searchers.

【正确答案】 A

【答案解析】New firms will enter a monopolistic competitive market with economic profits above zero and will absorb some market demand. This will shift the demand curve down to the point where price equals average total cost and there are zero economic profits.