All of the Following Are Characteristics of Monopolistic Competition EXCEPT

question 44

Multiple Choice

All of the following are characteristics of monopolistic competition EXCEPT:

• A) the use of advertising to differentiate products
• B) a relatively large number of sellers
• C) each seller firm is not particularly concerned about the relationship between its individual actions and those of other firms in the industry.
• D) a few sellers.
• E) each seller firm attempts to retain or increase its market share by differentiating its product from the output of other firms.

---

Definitions:

Efficient Scale

The level of production at which a firm achieves the lowest long-run average cost, with all inputs utilized most effectively.

Surplus

A situation where the quantity supplied of a good or service exceeds the quantity demanded at the current price, often leading to a decrease in prices.

Balance of Trade

The difference in value between a country's imports and exports over a certain period.

Money Inflows

Money inflows refer to the incoming funds to a business, organization, or economy from various sources such as investments, sales, and loans.