One difference between perfect competition and monopolistic competition is
A)firms in a perfectly competitive market produce similar but slightly different products.
B)in perfect competition, the product produced has no close substitutes.
C)monopolistic competition has barriers to entry, whereas perfect competition has none.
D)firms in monopolistic competition have some degree of market power.
E)a small number of firms compete in a monopolistically competitive market and a large number of firms compete in a perfectly competitive market.

Question

Quizplus · Accepted Answer

The main difference between perfect competition and monopolistic competition is that firms in monopolistic competition have some degree of market power due to product differentiation, while in perfect competition no firm has market power. The other options are not accurate descriptions of the differences between perfect and monopolistic competition.

One Difference Between Perfect Competition and Monopolistic Competition Is