- Created by: meloakes
- Created on: 29-03-15 11:47
- Monopolistic competition
- Many firms producing a differentiated product and few barriers to entry and exit
- Due to differentiation they face downwards sloping D curve
- Non price competition, but they are price makers
- Low barriers to entry. Supernormal profit is competed away
- Profit is normal due to tangible AR and AC
- Not allocative efficient due to P being higher than MC.
- Not productive efficient due to operating above minimum AC.
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