Question

What is difference between monopoly and monopolistic competition?

Answer 1

Monopolistic competition and monopolyare two market structures existing on rather two extremities of the market structure analysis. In this essay I will give their definitions, discussing theircharacteristics, giving their differences and concluding with an overview of what I have been able to achieve. Amos WEB (2000-2010) defines Monopolistic competition as a market structure in which a large number of firms manufacture and produce not necessarily the same product but similar products but still maintain a substantial amount of profit. For example, the manufacturing of pens, firms manufacturing these can be said to exist in a monopolistic competition market where four or more firms manufacture the same product or similar products in this case pens.