A monopolistically competitive market is characterized by all of the following EXCEPT ___________.

A

easy entry

B

differentiated products

C

excess capacity

D

economic profit in the long run

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Monopolistic competition characterizes an industry in which many firms offer products or services that are similar, but not perfect substitutes.

Monopolistic competition is the one in which there are large number of producers selling dissimilar products. There is also no entry barriers for the new firms. Hence, a monopolistically competitive market is characterized by all of the following except economic profit in the long run.

ANSWER
Monopolistic competition is the one in which there are large number of producers selling dissimilar products. There is also no entry barriers for the new firms. Hence, a monopolistically competitive market is characterized by all of the following except economic profit in the long run.
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