Entry and Exit Shift Existing Firms’ Demand Curves and Marginal Revenue CurvesEntry will occur in the long run when existing firms are profitable. In panel (a), entry causes each existing firm’s demand curve and marginal revenue curve to shift to the left. The firm receives a lower price for every unit it sells, and its profit falls. Entry will cease when firms make zero profit. Exit will occur in the long run when existing firms are unprofitable. In panel (b), exit from the industry shifts each remaining firm’s demand curve and marginal revenue curve to the right. The firm receives a higher price for every unit it sells, and profit rises. Exit will cease when the remaining firms make zero profit.