Monopolistic competition is an industry characterized by:
A) a product with no close substitutes.
B) many firms facing their own downward-sloping demand curve.
C) a small number of firms.
D) barriers to entry and exit.

Question

Quizplus · Accepted Answer

Monopolistic competition is characterized by many firms facing their own downward-sloping demand curve, which means they have some control over the price they charge for their product but face competition from other firms making similar products. The other choices are not characteristics of monopolistic competition.

Monopolistic Competition Is an Industry Characterized By