A large number of firms in Petrovia sell energy drinks.However,each firm faces a downward-sloping demand curve.The market for energy drinks in Petrovia is an example of a(n)________.

Question

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The downward-sloping demand curve faced by each firm in the market for energy drinks in Petrovia suggests that there is product differentiation among the various firms, indicating a monopolistically competitive market. In a perfectly competitive market, each firm faces a horizontal demand curve, while a monopoly would have a single firm with significant control over the market, and an oligopoly would have a few large firms dominating the market.

A Large Number of Firms in Petrovia Sell Energy Drinks