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12 September, 17:01

In Washington, D. C., there are many coffee shops, each offering nearly

identical coffee but each shop located in a different place around the city. It

is likely a coffee shop in Washington, D. C., operates in a

A)

perfectly competitive market.

B)

monopolistically competitive market.

C)

monopoly market.

D)

oligopoly market.

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Answers (1)
  1. 12 September, 19:26
    0
    The correct answer is B) monopolistically competitive market.

    Explanation:

    Monopolistic competition is an imperfect type of competition in which there is a high number of sellers in the market that have a certain power to influence the price of their product.

    The products offered are characterized by having some differentiation and it is precisely this differentiation that makes these companies enjoy a certain market power, have a certain voice when it comes to setting their prices and are not merely "price-acceptors", as in the case of perfect competition. Therefore, the graphic representation of monopolistic competition will be that of the right, imperfect competition.
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