The market structure of monopolistic competition exists when
A) there are a small number of interdependent firms that constitute the entire market.
B) there is a single producer of a product.
C) there are many producers of differentiated products.
D) there are many producers of a homogeneous product.

Question

Quizplus · Accepted Answer

Monopolistic competition exists when there are many producers of differentiated products. This means that each producer has some control over the price of their product due to the perceived differences between their product and the products of their competitors. This allows for some level of price differentiation and non-price competition in the market.

The Market Structure of Monopolistic Competition Exists When