In monopolistic competition, a firm introduces a new and differentiated product and will temporarily have a <u>less elastic</u> demand for its product and is able to charge a <u>higher price than before</u>.
Monopolistic competition exists while many agencies offer competing products or services which are similar, but no longer perfect, substitutes. The limitations to entry in a monopolistic aggressive industry are low, and the choices of any individual company no longer directly have an effect on its competition.
The demand curve as confronted with the aid of a monopolistic competitor isn't always flat, but as a substitute downward-sloping, which means that the monopolistic competitor, just like the monopoly, can increase its price without dropping all of its customers or lower its price and advantage greater customers.
A monopolistic market is a market structure with the characteristics of a natural monopoly. A monopoly exists when one provider gives a particularly suitable provider to many purchasers. In a monopolistic marketplace, the monopoly (or dominant employer) exerts manipulation over the market, enabling it to set the charge and supply.
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