Which Characteristic Is Associated with Monopolistic Competition

question 68

Multiple Choice

Which characteristic is associated with monopolistic competition?

• A) collusion
• B) product differentiation
• C) small number of firms
• D) awareness of rival firms in the market

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Definitions:

Disposable Income

Funds households are left with for saving or expenditure after income taxes are taken out.

APC (Average Propensity to Consume)

The fraction of income that is spent on consumption as opposed to savings.

Disposable Income

The amount of money available to households for making purchases and savings after the removal of income taxes.

Saving

The act of setting aside a portion of current income for future use, or the portion of income not spent on current expenditures.