In the term “monopolistic competition”, what does the word “monopoly” refer to?

1. A Option A: Monopolistically competitive firms produce beyond their efficient scale, and so do monopolists
2. B Option B: Monopolistically competitive firms charge prices equal to their marginal costs, just like monopolists
3. C Option C: A monopolistically competitive firm faces a downward-sloping demand curve for its differentiated product, and so does a monopolist
4. D Option D: Monopolistically competitive markets have free entry and exit, just like a monopolistic market

Answer checked 11 October 2026 · How we write and check questions