ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Under monopolistic competition, many sellers offer differentiated products-products that differ slightly but serve similar purposes. By making consumers aware of product differences, sellers exert some control over price.

Detailed explanation-2: -The most fundamental is perfect competition, in which there are large numbers of identical suppliers and demanders of the same product, buyer and sellers can find one another at no cost, and no barriers prevent new suppliers from entering the market. In perfect competition, no one has the ability to affect prices.

Detailed explanation-3: -The correct answer is b. The firm cannot affect the market price for its good. In a perfectly competitive market, a single firm cannot influence the market price.

Detailed explanation-4: -In a monopolistic market, there is only one firm that dictates the price and supply levels of goods and services, and that firm has total market control. In contrast to a monopolistic market, a perfectly competitive market is composed of many firms, where no one firm has market control.