Final answer:
The correct option:Increasing advertising
Increasing advertising can help a firm address its growth problem when actual sales growth exceeds its sustainable rate of growth in a monopolistically competitive market.
Step-by-step explanation:
To address a firm's growth problem when its actual sales growth exceeds its sustainable rate of growth, one possible action would be to increase advertising. By increasing advertising efforts, the firm can attract more customers and create greater demand for its products, allowing it to sustain its growth rate. For example, through targeted marketing campaigns or online advertisements, the firm can reach a wider audience and increase its market share.
Increasing advertising can also help the firm differentiate its products from competitors in a monopolistically competitive market. This differentiation can lead to increased demand for the firm's products and higher profits in the long run. By effectively communicating the unique features and benefits of its products, the firm can create a perception of value among consumers, encouraging them to choose its products over others.
Although there may be other strategies that can help address a firm's growth problem, such as improving product quality or expanding into new markets, increasing advertising is a specific action that can directly impact demand and contribute to the firm's growth.