Monopolistically competitive industries are characterized by all of the following except
A) Homogenous products.
B) Low entry barriers.
C) Low concentration ratios.
D) Independent production decisions.

Question

Quizplus · Accepted Answer

Monopolistically competitive industries are characterized by differentiated products or services, not homogenous products. This differentiation allows firms to have some market power and charge slightly different prices, which is why they are "monopolistically" competitive. Low entry barriers, low concentration ratios, and independent production decisions are all typical characteristics of a monopolistically competitive industry.

Monopolistically Competitive Industries Are Characterized by All of the Following