Han and Micah have just started their own business: a food truck that sells specialty Vietnamese food. Although the start-up costs were low, Han and Micah charge a higher price for their food than their competitors because people from all over the city come to buy their food. What type of market structure do they face?

Question

Quizplus · Accepted Answer

Han and Micah's food truck operates in a monopolistic competition market structure. This is indicated by their ability to charge higher prices due to their unique offering (specialty Vietnamese food), which differentiates them from competitors. In monopolistic competition, there are many sellers and they compete on quality, price, and marketing, with the products being differentiated but not unique.

Han and Micah Have Just Started Their Own Business: a Food