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| 1. |
Monopolistic Competition is competition with differentiated products? Explain |
| Answer» <html><body><p></p>Solution :An important <a href="https://interviewquestions.tuteehub.com/tag/characteristic-914243" style="font-weight:bold;" target="_blank" title="Click to know more about CHARACTERISTIC">CHARACTERISTIC</a> of <a href="https://interviewquestions.tuteehub.com/tag/monopolistic-2180801" style="font-weight:bold;" target="_blank" title="Click to know more about MONOPOLISTIC">MONOPOLISTIC</a> competition is product differentiation. The competing firms produce products which are <a href="https://interviewquestions.tuteehub.com/tag/close-408965" style="font-weight:bold;" target="_blank" title="Click to know more about CLOSE">CLOSE</a> but not perfect substitutes of each other. The products are <a href="https://interviewquestions.tuteehub.com/tag/differentiated-431924" style="font-weight:bold;" target="_blank" title="Click to know more about DIFFERENTIATED">DIFFERENTIATED</a> on the <a href="https://interviewquestions.tuteehub.com/tag/basis-893664" style="font-weight:bold;" target="_blank" title="Click to know more about BASIS">BASIS</a> of brand, size, colour, shape, etc. It is on account of this product differentiation, firms have to impur huge selling costs to complete with other firms. So, it is rightly said that 'Monopolistic Competition is compettion with diferentiated products'</body></html> | |