Asked by

Joshua Schaefer
on Nov 26, 2024

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Monopolistically competitive industries are inefficient because

A) they realize diseconomies of scale.
B) advertising costs retard technological advance and product development.
C) they are overpopulated with firms whose plants are underutilized.
D) monopolistically competitive sellers engage in misleading advertising.

Monopolistically Competitive

A market structure characterized by many firms selling similar but not identical products, allowing for some degree of market power.

Diseconomies of Scale

A situation where, as a company or production process increases in size, the cost per unit increases, usually due to inefficiencies.

Advertising Costs

Advertising costs are expenses incurred to promote products, services, or brands through various media channels.

  • Elucidate the notion of excess capacity and its consequences for efficiency in markets characterized by monopolistic competition.
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Ntethelelo MthobisiDec 02, 2024
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