A monopolistically competitive firm chooses
A)the quantity of output to produce, but the market determines price.
B)the price, but competition in the market determines the quantity.
C)price, but output is determined by a cartel production quota.
D)the quantity of output to produce and the price at which it will sell its output.

Question

Quizplus · Accepted Answer

A monopolistically competitive firm has some degree of market power, allowing it to set both the price and the quantity of output it produces, unlike in perfect competition where the market determines the price.

A Monopolistically Competitive Firm Chooses