One critical characteristic of monopolistic competition is:
A) one firm dominates the industry.
B) a few firms collude with each other by agreeing on price.
C) a few firms compete without agreeing on price.
D) there are many firms in the industry.
E) there is one large firm in the industry but it has no control over the price.

Question

Quizplus · Accepted Answer

Monopolistic competition is characterized by the presence of many firms in the industry, each producing differentiated products, allowing for some degree of market power.

One Critical Characteristic of Monopolistic Competition Is