ACME,Inc.operates in a market structure in which there are many other firms that find it easy to enter or exit.ACME is operating in ________ market.
A)a perfectly competitive market but not a monopolistically competitive
B)a perfectly competitive or a monopolistically competitive
C)a monopolistically competitive market but not a perfectly competitive
D)neither a perfectly competitive nor a monopolistically competitive
E)a monopolistic

Question

Quizplus · Accepted Answer

The description of many other firms being able to enter or exit the market easily indicates that there are low barriers to entry, which is a characteristic of both perfectly competitive and monopolistically competitive markets. Therefore, ACME could be operating in either market structure.

ACME,IncOperates in a Market Structure in Which There Are Many