Which of the Following Statements Is True About Monopolistically Competitive

question 90

Multiple Choice

Which of the following statements is true about monopolistically competitive firms?

• A)Unlike perfectly competitive firms, monopolistically competitive firms are able to raise their prices without losing all of their customers.
• B)Like perfectly competitive firms, monopolistically competitive firms are not able to raise prices without losing all of their customers because they face competition from firms selling similar products.
• C)Like perfectly competitive firms, monopolistically competitive firms maximise their profits by settling price equal to marginal cost.
• D)Unlike perfectly competitive firms, monopolistically competitive firms face perfectly inelastic demand curves.

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