Question

monopolistically competitive firms are unable to produce enough output to reach the average total cost because of the presence of other monopolistically competitive firms in the industry.

Answer 1

Monopolistically competitive firms are unable to produce enough output to reach the average total cost because of the presence of other monopolistically competitive firms in the industry.

• Monopolistic competition arises when several businesses provide rival goods or services that are comparable but imperfect replacements.

• Entry barriers are low in monopolistic competitive industries, and actions made by one business do not immediately impact those of its rivals. Pricing and marketing choices are how the rival firms set themselves apart.

• Businesses engaged in monopolistic rivalry distinguish their goods through price and marketing tactics.

• The expenses or other impediments that prohibit new rivals from joining a market are minimal in monopolistic competition.

• Between perfect and monopolistic competition, known as monopolistic competition, there is monopolistic competition, which incorporates aspects of both and entails businesses with comparable but distinct product offers.

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