ECONOMICS
COMPETITION AND MARKET STRUCTURES
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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In perfect competition there are no barriers to entry, but there are strong barriers in monopolistic competition.
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In perfect competition there are many firms, but in monopolistic competition there are only a few firms.
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In perfect competition the firms all sell products that are exactly the same, but in monopolistic competition each firm sells a slightly differentiated product.
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In perfect competition there are few consumers, but in monopolistic competition there are many consumers.
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Detailed explanation-1: -In perfect competition, firms produce identical goods, while in monopolistic competition, firms produce slightly different goods.
Detailed explanation-2: -A monopoly is the type of imperfect competition where a seller or producer captures the majority of the market share due to the lack of substitutes or competitors. A monopolistic competition is a type of imperfect competition where many sellers try to capture the market share by differentiating their products.
Detailed explanation-3: -What is the difference between perfect competition and monopolistic competition? In perfect competition, firms produce identical goods. While monopolistic competition firms produce slightly different goods.
Detailed explanation-4: -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.