Which market structure is characterized by many sellers offering differentiated products with low barriers to entry and non-price competition?
Answer and explanation
Correct answer: B. Monopolistische concurrentie (monopolistic competition)
- Step 1: Monopolistic competition combines many buyers and sellers, free entry and exit, and product differentiation (branding, design). Step 2. Examples include restaurants, clothing retailers, and hairdressers. Answer: Monopolistische concurrentie (monopolistic competition). Why not the others: Perfect competition features identical homogeneous goods; oligopoly has high entry barriers and few sellers; monopoly has one seller.
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