Which of the following industries is most likely to be monopolistically competitive?
A)automobile production
B)fresh bagel shops
C)corn farming
D)electric utility production

Question

Quizplus · Accepted Answer

Monopolistic competition occurs when there are many small firms selling differentiated products, which means there is a degree of product differentiation and firms have some control over price. Fresh bagel shops fit this description, as there are many small shops that sell slightly different types of bagels, such as plain, sesame seed, everything, etc. Automobile production, corn farming, and electric utility production, on the other hand, are more likely to be either oligopolistic or monopolistic due to significant barriers to entry and high economies of scale.

Which of the Following Industries Is Most Likely to Be