Question

As a result of increased competition​ (higher number of firms n​) in a monopolistically competitive​ industry, A. low minus cost firms thrive and increase their profits and market shareslow−cost firms thrive and increase their profits and market shares. B. low minus cost firms contract and the lowest minus cost firms exitlow−cost firms contract and the lowest−cost firms exit. C. the vertical intercept of the individual demand curve increasesthe vertical intercept of the individual demand curve increases. D. overall productivity in the industry decreasesoverall productivity in the industry decreases.

Answer 1

Answer: D, overall productivity in the industry decreases.

Explanation: a producer can gain less market share from a given price cut.

Increased in competition means there are more firms and this will not effect consumers decisions.