A similarity between monopoly and monopolistic competition is that in both market structures
A)there are a large number of sellers.
B)strategic interactions among sellers are important.
C)each firm faces a downward-sloping demand curve.
D)there are only a few buyers but many sellers.

Question

Quizplus · Accepted Answer

In both monopoly and monopolistic competition, each firm faces a downward-sloping demand curve. This means that the firm can influence the price of its product by adjusting the quantity supplied. In a monopoly, the firm is the sole provider of a good or service, while in monopolistic competition, there are many firms offering differentiated products, but each has some control over its price because its product is unique in some way.

A Similarity Between Monopoly and Monopolistic Competition Is That in Both