Entry into a market characterized by monopolistic competition is generally
A)Entirely blocked by existing firms.
B)Very easy because few barriers exist.
C)As difficult as in oligopoly.
D)More difficult than entry into monopolized markets.

Question

Quizplus · Accepted Answer

In a market characterized by monopolistic competition, there are few barriers to entry. This is because there are many small firms in the market, each producing differentiated products, and no single firm has significant control over the market. As a result, new firms can enter the market without much difficulty and begin competing with the existing firms.

Entry into a Market Characterized by Monopolistic Competition Is Generally