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Economics
MEDIUM
ENGLISH
Economics
The use of word “competition” in the name of the market structure called “monopolistic competition” refers to the fact that ?
there are many sellers in a monopolistically competitive market and there is free entry and exit in the market just like a competitive market
Correct answer
B
Monopolistically competitive firms face a downward-sloping demand curve just like competitive firms.
Option B
C
Monopolistically competitive firms charge prices equal to the minimum of their average total cost just like competitive firms.
Option C
D
The products are differentiated in a monopolistically competitive market just like in a competitive market.
Option D
Correct answer: A
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