Question

Uniform price for homogeneous product at any one time is the essential condition of _______.

• A. monopolistic competition
• B. oligopoly
• C. perfect competition
• D. duopoly

Answer 1

Answer: (A)

monopolistic competition

Monopolistic competition characterizes an industry in which many firms offer products or services that are similar, but not perfect substitutes. Barriers to entry and exit in a monopolistic competitive industry are low, and the decisions of any one firm do not directly affect those of its competitors. The Fast Food companies like the McDonald and Burger King who sells the burger in the market are the most common type of example of monopolistic competition. The two companies mentioned above sell an almost similar type of products but are not the substitute of each other.