Product differentiation exists in
A) oligopolies only.
B) monopolies only.
C) monopolistic competition only.
D) all market structures except perfect competition.

Question

Quizplus · Accepted Answer

Product differentiation, which is the process of distinguishing a company's products or services from its competitors, exists in all market structures except perfect competition. In perfect competition, all firms offer identical products, so there is no room for differentiation. In monopolies, there is a single producer and no close substitutes, so there may not be any need for product differentiation. In oligopolies and monopolistic competition, however, firms differentiate their products to attract customers and gain a competitive advantage.

Product Differentiation Exists in