What is one way in which monopolistic competition differs from oligopoly

Question

Quizplus · Accepted Answer

Monopolistic competition involves many firms selling differentiated products, while oligopoly involves a small number of firms dominating the market. Thus, B is the correct answer as it highlights the key difference between the two market structures. A is incorrect because oligopolies can have barriers to entry, such as economies of scale and significant startup costs. C is incorrect because in the long run, oligopoly firms may earn positive, negative or zero economic profits. D is incorrect because strategic interactions and collusion can be common in oligopolies.

What Is One Way in Which Monopolistic Competition Differs from Oligopoly