When considering the definition of "monopolistic competition," it is wise to place emphasis upon the first word as it most nearly describes market performance within this industry structure.

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Monopolistic competition is characterized by many firms offering differentiated products, not by a single firm's dominance or monopoly-like behavior. The emphasis should be on the competition aspect, as firms compete on product quality, price, and marketing, unlike in a pure monopoly where one firm controls the market.

When Considering the Definition of "Monopolistic Competition," It Is Wise