Which of the following is NOT a characteristic of monopolistic competition?
A) Firms have some control over their markets.
B) Firms produce an identical product.
C) Firms retain some ability to control prices.
D) The average cost for firms declines as they produce more output.

Question

Quizplus · Accepted Answer

Monopolistic competition is characterized by firms producing differentiated products, giving them some control over their individual markets and the ability to control prices to a certain extent. However, firms in monopolistic competition do not produce identical products. The average cost for firms may also not necessarily decline as they produce more output, as they still face some economies of scale constraints.

Which of the Following Is NOT a Characteristic of Monopolistic