What is the biggest difference between perfect competition and monopolistic competition?
A) Perfect competitors can differentiate their products.
B) Monopolistic competitors have some influence over price.
C) Accounting costs and economic costs are the same for perfect competitors.
D) Monopolistic competitors are protected by barriers to entry.

Question

Quizplus · Accepted Answer

The biggest difference between perfect competition and monopolistic competition is that monopolistic competitors have some influence over price, while perfect competitors are price takers and have no control over price. In monopolistic competition, firms can differentiate their products to some extent, which allows them to have some market power and influence over pricing. However, they still face competition from other firms offering similar products. Accounting costs and economic costs are the same for both types of competition, and monopolistic competitors may or may not face barriers to entry.

What Is the Biggest Difference Between Perfect Competition and Monopolistic