Under monopolistic competition, there is excess capacitybecause a. there are sub

Question

Under monopolistic competition, there is excess capacitybecause a. there are substantial economies of scale b. fims may want to produce in the future if demandincreases c. there are not enough firms d. the firms demand curve slopes downward and the firmmakes zero economic profits in the long run equilibrium e. firms are wasteful Under monopolistic competition, there is excess capacitybecause a. there are substantial economies of scale b. fims may want to produce in the future if demandincreases c. there are not enough firms d. the firms demand curve slopes downward and the firmmakes zero economic profits in the long run equilibrium e. firms are wasteful

Explanation / Answer

Not a, c, or e. The answer has to be B. future demand. Fluctuations in demand occur and a monopoly has to handle it.

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