Final answer:
Monopolistic competition is a market structure characterized by many sellers producing differentiated products with some control over pricing, in a market with easy entry and exit. It allows for product differentiation and competition among firms.
Step-by-step explanation:
Monopolistic competition is a market structure characterized by a relatively large number of sellers producing a differentiated product, for which they have some control over the price they charge, in a market with relatively easy market entry and exit. In monopolistic competition, each firm sells a product that is slightly different from its competitors, allowing them to have some pricing power. This structure allows for product differentiation and competition among firms.
For example, the fast food industry is a monopolistically competitive market. There are many fast food chains, such as McDonald's, Burger King, and Wendy's, each selling a slightly different product to attract customers. They have control over the prices they charge for their products, but face competition from other fast food chains.
In summary, monopolistic competition is a market structure where there are many sellers producing differentiated products, with some control over pricing, and relatively easy market entry and exit.