Monopolistic competition Flashcards

1
Q

What are the characteristics of monopolistic competition?

A

Many buyers and sellers
Perfect information
Slightly differentiated products
Very low barriers to entry and exit

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2
Q

How is profit maximised in monopolistic competition?

A

Supernormal profits are made in the short run which would attract new supplier who offer new products and sp normal profit can only be made in the long run.

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3
Q

What are some non-price competition methods?

A

Efficiency and use of online ordering
Making clothing available in a bigger range of sizes
Customisation of products
Return policies
Outlet shops
Effective use of social media
Taking steps to address corporate social responsibility

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