Monopolistically competitive firms ignore the effect of their decisions upon other firms in the industry because
A)each firm is large relative to the market
B)each firm is small relative to the market
C)there are few sellers in the market
D)there is only one seller in the market
E)all firms follow the same known pricing rules

Question

Quizplus · Accepted Answer

Monopolistically competitive firms are small relative to the market and therefore do not have a significant impact on the decisions of other firms in the industry.

Monopolistically Competitive Firms Ignore the Effect of Their Decisions Upon