Which of the following are attributes of a monopolistic competitive market?
(i) many firms competing for the same group of sellers
(ii) each firm produces a product that is slightly different from the other firms
(iii) in the long run, entry into the industry is restricted

Question

Quizplus · Accepted Answer

(i) is true, as there are many firms competing in a monopolistic competitive market.
(ii) is true, as each firm produces a slightly differentiated product aimed at the same group of buyers.
(iii) is false, because in the long run, entry into a monopolistic competitive market is relatively easy as compared to entry into a monopoly market. Therefore, only (i) and (ii) are attributes of a monopolistic competitive market.

Which of the Following Are Attributes of a Monopolistic Competitive