Final answer:
A monopolistic competitor can earn positive profits in the short term, but these profits will erode to $0 in the long run as new entrants compete away the supernormal profits.
Step-by-step explanation:
The question concerns a monopolistic competitor and what the firm's profits will amount to in the long run. In a monopolistic competition, similar to a monopoly, the firm will determine its profit-maximizing quantity and price by finding the point where its marginal costs equal marginal revenues. However, unlike a pure monopoly that can maintain profits in the long run due to barriers to entry, a monopolistic competitor will see its profits eroded to zero in the long run due to the entry of new competitors.
The key understanding here is that while monopolistic competitors can earn profits in the short term, they cannot maintain them in the long run. The answer to the question is that the firm's profits will equal $0 in the long run as other firms enter the market and drive the profit to a normal level, which is characterized by the point where price equals the long-run average cost.