The number of firms in a monopolistically competitive industry means that

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Monopolistically competitive industries have a large number of firms, and therefore, there is no possibility of collusion or cooperation to set a pure monopoly price. Each firm in the industry produces a slightly differentiated product and will try to attract customers by setting prices lower than its competitors. Therefore, the firms will not cooperate to set a common price. Additionally, monopolistically competitive industries typically have low barriers to entry, making it difficult for existing firms to prevent new firms from entering.

The Number of Firms in a Monopolistically Competitive Industry Means