Monopolistic competition

What is the shape of the average revenue curve in monopolistic competition?

What is a characteristic of markets in monopolistic competition?

How do firms in monopolistic competition determine their production and pricing?

They produce at the point where marginal cost is equal to marginal revenue and charge the price shown by the average revenue curve.
They produce at the point where marginal cost is equal to average revenue and charge the price shown by the marginal cost curve.
They produce at the point where average cost is equal to average revenue and charge the price shown by the marginal revenue curve.
They produce at the point where average cost is equal to marginal revenue and charge the price shown by the average cost curve.

What is the impact of product differentiation in monopolistic competition?

It increases costs for firms with little benefit for consumers.
It restricts individual firms output compared to other market structures of oligopoly and monopoly.
It provides valuable choice for consumers to give them a range of different options to choose from when they're buying those products and services.
It reduces X inefficiency, which is an economic way of saying that firms might get a bit lazy if they weren't spurred on by this additional competition.

What happens to the supernormal profits in the long run in monopolistic competition?

What happens to the average revenue curve in a monopolistic competition when new firms enter the market?

The average revenue curve fluctuates unpredictably when new firms enter the market.
The average revenue curve shifts right until supernormal profits are available.
The average revenue curve keeps shifting left until only normal profits are available.
The average revenue curve remains constant regardless of new firms entering the market.

What happens when a firm in monopolistic competition is attracted by high profits?