ECONOMICS
COMPETITION AND MARKET STRUCTURES
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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the small number of firms in the industry.
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product differentiation
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the small number of firms in the industry.
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a lack of advertisement
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Detailed explanation-1: -Product Differentiation: Product differentiation is the main feature of monopolistic competition. Product differentiation means that product of different types, brands, and qualities will be available to customers in a fixed time period.
Detailed explanation-2: -Product differentiation is the key feature of monopolistic competition, where products are marketed by quality or brand. Demand is highly elastic, and any change in pricing can cause demand to shift from one competitor to another.
Detailed explanation-3: -Monopolistic competition is a market structure where: There are large number of sellers selling differentiated products. There is also no entry barriers on the firm. There is free entry and exit of new or existing firms.