The market is initially in long-run equilibrium

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The market for plumbing services in a city can be characterized by the model of monopolistic competition. Suppose that the market is initially in long-run equilibrium, and then there is an increase in demand for plumbing services. We expect that in the long run:

firms will leave the plumbing market.

new firms will enter the plumbing market.

firms will shut down, but they will not leave the industry.

Reference no: EM131392109

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