In a monopolistically competitive market,the advantage that a seller has over competitors or newcomers is
A)the consumer preference for its brand.
B)the high price elasticity of demand for its product.
C)the high price elasticity of supply for its product.
D)the licenses or patents it has received.

Question

Quizplus · Accepted Answer

In a monopolistically competitive market, products are differentiated, and consumers may have a preference for a particular brand. This can give an advantage to a seller who has established a strong brand image and loyal customer base. This advantage is not based on licenses or patents but is instead related to the perception of the brand in the minds of consumers. The high price elasticity of demand for a product may make it more challenging for a seller to maintain a high price for their product, but this is not necessarily an advantage unless the seller is able to differentiate themselves from competitors and become a preferred option for consumers. Similarly, the high price elasticity of supply is not an advantage, as this indicates that there are many potential suppliers and substitutes available.

In a Monopolistically Competitive Market,the Advantage That a Seller Has