The attributes of monopolistic competition and its similarities to perfect competition and monopoly .

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Answer 1

Question

Chapter 16, Problem 1QR

To determine

The attributes of monopolistic competition and its similarities to perfect competition and monopoly.

Expert Solution & Answer

Explanation of Solution

The three main characteristics of monopolistic competition are as follows:

1. Many sellers: There are many firms competing with each other for the same customers.
2. Product differentiation: Each seller produces similar, but not identical products.
3. Free entry and exit: Firms can enter or exit the market without any restrictions.

Like in monopoly, monopolistic competitive firm faces a downward sloping demand curve as the price is greater than the marginal cost.

Also, similar to that of a perfectly competitive market, a monopolistically competitive firm drives zero economic profit in the long run. This is because, in the long run, price equals the average total cost due to free entry and exit of firms.

Economics Concept Introduction

Concept introduction:

Monopolistic competition: It is an imperfect market structure in which many firms sell products that are differentiated from one another.

Monopoly: It is the market structure characterized by a single seller who sells products that have no close substitutes.

Perfect competition: It is the perfect market structure where there are large numbers of sellers and buyers, with sellers selling homogeneous products.

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Students have asked these similar questions

Describe the three attributes of monopolistic competition. How is monopolistic competition like monopoly? How is it like perfect competition?

Explain how monopolistic competition is different from perfect competition and monopoly in both the short- and long run?

Explain monopolistic competition. How is it similar to perfect competition? How does it differ from perfect competition?

Answer 2

Question

Chapter 16, Problem 1QR

To determine

The attributes of monopolistic competition and its similarities to perfect competition and monopoly.

Expert Solution & Answer

Explanation of Solution

The three main characteristics of monopolistic competition are as follows:

1. Many sellers: There are many firms competing with each other for the same customers.
2. Product differentiation: Each seller produces similar, but not identical products.
3. Free entry and exit: Firms can enter or exit the market without any restrictions.

Like in monopoly, monopolistic competitive firm faces a downward sloping demand curve as the price is greater than the marginal cost.

Also, similar to that of a perfectly competitive market, a monopolistically competitive firm drives zero economic profit in the long run. This is because, in the long run, price equals the average total cost due to free entry and exit of firms.

Economics Concept Introduction

Concept introduction:

Monopolistic competition: It is an imperfect market structure in which many firms sell products that are differentiated from one another.

Monopoly: It is the market structure characterized by a single seller who sells products that have no close substitutes.

Perfect competition: It is the perfect market structure where there are large numbers of sellers and buyers, with sellers selling homogeneous products.

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Answer 3

Question

Chapter 16, Problem 1QR

To determine

The attributes of monopolistic competition and its similarities to perfect competition and monopoly.

Expert Solution & Answer

Explanation of Solution

The three main characteristics of monopolistic competition are as follows:

1. Many sellers: There are many firms competing with each other for the same customers.
2. Product differentiation: Each seller produces similar, but not identical products.
3. Free entry and exit: Firms can enter or exit the market without any restrictions.

Like in monopoly, monopolistic competitive firm faces a downward sloping demand curve as the price is greater than the marginal cost.

Also, similar to that of a perfectly competitive market, a monopolistically competitive firm drives zero economic profit in the long run. This is because, in the long run, price equals the average total cost due to free entry and exit of firms.

Economics Concept Introduction

Concept introduction:

Monopolistic competition: It is an imperfect market structure in which many firms sell products that are differentiated from one another.

Monopoly: It is the market structure characterized by a single seller who sells products that have no close substitutes.

Perfect competition: It is the perfect market structure where there are large numbers of sellers and buyers, with sellers selling homogeneous products.

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Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

Chapter 16, Problem 1QR

To determine

The attributes of monopolistic competition and its similarities to perfect competition and monopoly.

Expert Solution & Answer

Explanation of Solution

The three main characteristics of monopolistic competition are as follows:

1. Many sellers: There are many firms competing with each other for the same customers.
2. Product differentiation: Each seller produces similar, but not identical products.
3. Free entry and exit: Firms can enter or exit the market without any restrictions.

Like in monopoly, monopolistic competitive firm faces a downward sloping demand curve as the price is greater than the marginal cost.

Also, similar to that of a perfectly competitive market, a monopolistically competitive firm drives zero economic profit in the long run. This is because, in the long run, price equals the average total cost due to free entry and exit of firms.

Economics Concept Introduction

Concept introduction:

Monopolistic competition: It is an imperfect market structure in which many firms sell products that are differentiated from one another.

Monopoly: It is the market structure characterized by a single seller who sells products that have no close substitutes.

Perfect competition: It is the perfect market structure where there are large numbers of sellers and buyers, with sellers selling homogeneous products.

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Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 16, Problem 1QR

To determine

The attributes of monopolistic competition and its similarities to perfect competition and monopoly.

Expert Solution & Answer

Explanation of Solution

The three main characteristics of monopolistic competition are as follows:

1. Many sellers: There are many firms competing with each other for the same customers.
2. Product differentiation: Each seller produces similar, but not identical products.
3. Free entry and exit: Firms can enter or exit the market without any restrictions.

Like in monopoly, monopolistic competitive firm faces a downward sloping demand curve as the price is greater than the marginal cost.

Also, similar to that of a perfectly competitive market, a monopolistically competitive firm drives zero economic profit in the long run. This is because, in the long run, price equals the average total cost due to free entry and exit of firms.

Economics Concept Introduction

Concept introduction:

Monopolistic competition: It is an imperfect market structure in which many firms sell products that are differentiated from one another.

Monopoly: It is the market structure characterized by a single seller who sells products that have no close substitutes.

Perfect competition: It is the perfect market structure where there are large numbers of sellers and buyers, with sellers selling homogeneous products.

Answer 6

Chapter 16, Problem 1QR

To determine

The attributes of monopolistic competition and its similarities to perfect competition and monopoly.

Expert Solution & Answer

Explanation of Solution

The three main characteristics of monopolistic competition are as follows:

1. Many sellers: There are many firms competing with each other for the same customers.
2. Product differentiation: Each seller produces similar, but not identical products.
3. Free entry and exit: Firms can enter or exit the market without any restrictions.

Like in monopoly, monopolistic competitive firm faces a downward sloping demand curve as the price is greater than the marginal cost.

Also, similar to that of a perfectly competitive market, a monopolistically competitive firm drives zero economic profit in the long run. This is because, in the long run, price equals the average total cost due to free entry and exit of firms.

Economics Concept Introduction

Concept introduction:

Monopolistic competition: It is an imperfect market structure in which many firms sell products that are differentiated from one another.

Monopoly: It is the market structure characterized by a single seller who sells products that have no close substitutes.

Perfect competition: It is the perfect market structure where there are large numbers of sellers and buyers, with sellers selling homogeneous products.

Answer 7

Chapter 16, Problem 1QR

To determine

The attributes of monopolistic competition and its similarities to perfect competition and monopoly.

Answer 8

Expert Solution & Answer

Explanation of Solution

The three main characteristics of monopolistic competition are as follows:

1. Many sellers: There are many firms competing with each other for the same customers.
2. Product differentiation: Each seller produces similar, but not identical products.
3. Free entry and exit: Firms can enter or exit the market without any restrictions.

Like in monopoly, monopolistic competitive firm faces a downward sloping demand curve as the price is greater than the marginal cost.

Also, similar to that of a perfectly competitive market, a monopolistically competitive firm drives zero economic profit in the long run. This is because, in the long run, price equals the average total cost due to free entry and exit of firms.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Economics Concept Introduction

Concept introduction:

Monopolistic competition: It is an imperfect market structure in which many firms sell products that are differentiated from one another.

Monopoly: It is the market structure characterized by a single seller who sells products that have no close substitutes.

Perfect competition: It is the perfect market structure where there are large numbers of sellers and buyers, with sellers selling homogeneous products.

Answer 12

Ch. 16.1 - Prob. 1QQ Ch. 16.2 - Prob. 2QQ Ch. 16.3 - Prob. 3QQ Ch. 16 - Prob. 1QR Ch. 16 - Prob. 2QR Ch. 16 - Prob. 3QR Ch. 16 - Prob. 4QR Ch. 16 - How might advertising reduce economic well-being?...Ch. 16 - Prob. 6QR Ch. 16 - Prob. 7QR

The attributes of monopolistic competition and its similarities to perfect competition and monopoly .

Solution Summary: The author explains the characteristics of monopolistic competition, which are similar to perfect competition. Monopoly is characterized by a single seller who sells products with no close substitutes.

The attributes of monopolistic competition and its similarities to perfect competition and monopoly.

Explanation of Solution

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