Do consumers benefit in any way from monopolistic competition relative to perfect competition? compared to perfect competition, when a consumer purchases a product from a monopolistically competitive firm, the consumer benefits from purchasing a product

a. without coercion from advertising.

b. that is more closely suited to their tastesis more closely suited to their tastes.

c. whose marginal benefit to that consumer equals its marginal cost of production.

d. that is not trademarkedthat is not trademarked.

e. whose price equals marginal costwhose price equals marginal cost.

Question

Isla Hendricks

Business

18 December, 00:43

Do consumers benefit in any way from monopolistic competition relative to perfect competition? compared to perfect competition, when a consumer purchases a product from a monopolistically competitive firm, the consumer benefits from purchasing a product

a. without coercion from advertising.

b. that is more closely suited to their tastesis more closely suited to their tastes.

c. whose marginal benefit to that consumer equals its marginal cost of production.

d. that is not trademarkedthat is not trademarked.

e. whose price equals marginal costwhose price equals marginal cost.

+1

Answers (1)

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Leonard · Answer 1

B) that is more closely suited to their tastes

Explanation:

In a perfect competition market the products are all similar and homogeneous. Since all suppliers are price takers, they have to produce similar products in order to be able to compete.

In monopolistic competition markets the products offered are different on from another. The products are not homogeneous and sometimes cannot even be considered substitute products.

Therefore there is a chance that a consumer can find more suitable products or services that they like more than others. For example, restaurants are monopolistic competition but you can decide which restaurant you like the most.