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Monopolistic Competition

Which of the ...

Question

Which of the following market structure arises when the products are differentiated as opposed to perfect substitutes?

A

Monopoly

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B

Oligopoly

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C

Perfect competition

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D

Monopolistic competition

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Solution

The correct option is D
Monopolistic competition

When products are differentiated and not perfect substitutes of each other, it results in a market structure called as monopolistic competition.

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Explain "perfect knowledge about the markets" feature of perfect competition.

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Q. There are no selling costs in perfect competition as well as monopoly form of market.

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Q. Distinguish between the following:

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2. Perfect competition and Monopoly

3. Natural monopoly and Social monopoly

4. Natural monopoly and legal monopoly

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Q. Fill in the blanks with appropriate alternatives given in the brackets:

1. Under perfect competition commodities are ________________ in nature. (homogeneous/ classified/ heterogeneous/ supplementary)

2. _____________ appears in a monopoly market. (product differentiation/ price discrimination/ individual differentiation/ packing differentiation)

3. The price at which demand and supply equate to each other is called _______ price. (general/ equilibrium/ short-run/ reserve)

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