Which of the following is not characteristic of monopolistic competition?

A) relatively large numbers of sellers C) production at minimum ATC in the long-run

B) product differentiation D) relatively easy entry to the industry

Question

Business

Emilia Chavez

28 September, 20:22

Which of the following is not characteristic of monopolistic competition?

A) relatively large numbers of sellers C) production at minimum ATC in the long-run

B) product differentiation D) relatively easy entry to the industry

+2

Answers (1)

Know the Answer?

Dickens · Answer 1

The correct answer is option C.

Explanation:

A monopolistic market is a form of market where there is a large number of producers who are producing close substitutes. There are few barriers to entry in the market, but it is easier to enter as compared to other imperfect markets.

Monopolistic firms face a downward-sloping demand curve. They are not price takers and don't need to produce at the minimum ATC in the long run like a firm in a perfectly competitive market.

So, option C is the correct answer.

Which of the following is not characteristic of monopolistic competition?A) relatively large numbers of sellers C) production at minimum ATC in the long-runB) product differentiation D) relatively easy entry to the industry

Which of the following is not characteristic of monopolistic competition?

A) relatively large numbers of sellers C) production at minimum ATC in the long-run

B) product differentiation D) relatively easy entry to the industry