Asked by jamie sherwood on Jun 23, 2024
Verified
When an industry has many firms, the industry is
A) an oligopoly if the firms sell differentiated products, but it is monopolistically competitive if the firms sell identical products.
B) an oligopoly if the firms sell differentiated products, but it is perfectly competitive if the firms sell identical products.
C) monopolistically competitive if the firms sell differentiated products, but it is perfectly competitive if the firms sell identical products.
D) perfectly competitive if the firms sell differentiated products, but it is monopolistically competitive if the firms sell identical products.
Monopolistically Competitive
A market structure characterized by many firms selling products that are similar but not identical, allowing for some degree of market power and product differentiation.
Oligopoly
A market setup where just a few companies dominate the market, resulting in minimal competition.
- Achieve an understanding of the aspects and implications of monopolistic competition.
Verified Answer
KW
Kyrsten WilliamsJun 29, 2024
Final Answer :
C
Explanation :
An industry is monopolistically competitive when it has many firms selling differentiated products, and it is perfectly competitive when many firms sell identical products.
Learning Objectives
- Achieve an understanding of the aspects and implications of monopolistic competition.
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