Product differentiation is most important to
A)monopolistic competition.
B)perfect competition.
C)monopoly.
D)a regulated industry.
E)government enterprises.

Question

Quizplus · Accepted Answer

Product differentiation is the key feature of monopolistic competition where firms try to differentiate their products from those of their competitors in order to gain market power and price control. This is not as important in perfect competition where all firms produce identical products and have no market power, monopoly where there is no competition, regulated industries where the government sets regulations for production and pricing, or government enterprises where the government owns and controls the industry.

Product Differentiation Is Most Important to