Question

A moderately-priced jewelry store is trying to differentiate itself from other jewelry stores. The store prices products somewhat lower than the superpremium jewelry stores, but offers better products and services than low-end jewelry stores provide. The market situation this store faces sounds most like:___________
A. pure competition.
B. monopoly.
C. oligopoly.
D. monopolistic competition.
E. oligopolistic competition

Answer 1

Answer:

The correct option is D

Explanation:

Monopolistic competition is the market which characterizes or classify the industry, in which most of the businesses offer or provide the services or the products that are similar, but are not perfect substitutes.

In monopolistic competition, for the industry to exit as well as entry have barriers low and the single firm or business decisions, will not affect those of its competitors.

So, in this scenario, the jewelry store is in a situation where the store faces the most like monopolistic competition.