Asked by Suraksha Lamichhane on Jul 07, 2024
Verified
Monopolistically competitive firms exist due to high barriers to entry.
Monopolistically Competitive
Describes a market structure where many companies sell products that are substitutes, but are not perfect substitutes, leading to some degree of market power for each firm.
Barriers to Entry
Obstacles that make it difficult for new competitors to enter a market, such as high startup costs or strict regulations.
- Identify how barriers to entering and leaving a market influence the competitive environment and long-term profit outcomes.
Verified Answer
MT
Monique TatumJul 08, 2024
Final Answer :
False
Explanation :
Monopolistically competitive markets are characterized by low barriers to entry, allowing new firms to enter the market easily.
Learning Objectives
- Identify how barriers to entering and leaving a market influence the competitive environment and long-term profit outcomes.
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