Monopolistic competition is similar to that of monopoly, but it allows for free entry and exit of competing firms.

Question

Quizplus · Accepted Answer

Monopolistic competition is characterized by many small firms that sell similar but not identical products, giving them some degree of market power. However, unlike a monopoly, there are low barriers to entry and exit, allowing for new firms to enter the market and compete with existing firms.

Monopolistic Competition Is Similar to That of Monopoly, but It