Firms are less affected by competitors' pricing strategies under than under .
A)oligopolistic competition;pure competition
B)pure competition;monopolistic competition
C)oligopolistic competition;monopolistic competition
D)monopolistic competition;oligopolistic competition
E)pure competition;a pure monopoly

Question

Quizplus · Accepted Answer

In monopolistic competition, firms have differentiated products and therefore customers have a strong preference for a specific brand or product. This makes it difficult for competitors to poach customers by lowering prices. In contrast, in oligopolistic competition where there are only a few dominant firms, pricing decisions by one firm can have a significant impact on the market and can trigger a price war among competitors.

Firms Are Less Affected by Competitors' Pricing Strategies Under Than