Which feature is shared by monopolistic competition and perfect competition?
A)few firms in the industry
B)no barriers to entry or exit in the long run
C)absolute market power
D)standardized products

Question

Quizplus · Accepted Answer

Both monopolistic competition and perfect competition have no barriers to entry or exit in the long run, meaning that new firms can enter the market and existing firms can leave without facing significant obstacles. However, they differ in other features such as the number of firms in the industry and the degree of product differentiation. Monopolistic competition involves many firms and differentiated products, while perfect competition involves many firms and standardized products. Monopolistic competition also does not have absolute market power, as firms have some control over their prices but face competition from close substitutes.

Which Feature Is Shared by Monopolistic Competition and Perfect Competition