Advertisements
Advertisements
Question
Which of the characteristics separates it from perfect competition and why?
Advertisements
Solution
Product differentiation in monopolistic competition separates it from perfect competition because the products are homogeneous. They are identical in all respects such as size, shape and quality in perfect competition. Selling cost is heavy in the case of monopolistic completion whereas the selling is not incurred as they have perfect knowledge of product in perfect competition.
shaalaa.com
Is there an error in this question or solution?
