A monopolistically competitive firm chooses its
A)price and quantity just as a monopoly does.
B)quantity but faces a horizontal demand curve just as a competitive firm does.
C)price but can sell any quantity at the market price just as an oligopoly does.
D)price and quantity based on the decisions of the other firms in the industry just as an oligopoly does.

Question

Quizplus · Accepted Answer

A monopolistically competitive firm, like a monopoly, has some control over its price and chooses its price and quantity to maximize profit, facing a downward-sloping demand curve.

A Monopolistically Competitive Firm Chooses Its