Question

Which statement best describes a situation where monopolistic competition exists?

a. Many sellers, similar products
b. One seller, unique product
c. Few sellers, identical products
d. One seller, no substitutes

Answer 1

Monopolistic competition is a market structure characterized by many firms selling similar but varied products with few barriers to entry. The best statement that describes a situation where monopolistic competition exists is 'Many sellers, similar products'.

Step-by-step explanation:

Monopolistic competition is a market structure characterized by many firms selling similar but varied products with few barriers to entry. The best statement that describes a situation where monopolistic competition exists is a. Many sellers, similar products. In monopolistic competition, there are multiple sellers offering products that are similar but not identical, giving consumers a range of options to choose from.