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In a Monopolistically Competitive Industry, the Competitive Element Results from _____

Question 40

Multiple Choice

In a monopolistically competitive industry, the competitive element results from _____ and the monopoly element results from _____.


A) product differentiation; substantial barriers to entry
B) a large number of firms and free entry; product differentiation
C) advertising; product differentiation
D) product differentiation; the small number of large producers
E) positive economic profit in the long run and substantial barriers to entry; perfectly elastic demand curve

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