Compare and contrast a monopoly and a monopolistic competition. What

QUESTION

Compare and contrast a monopoly and a monopolistic competition.

What will be an ideal response?

ANSWER

In a monopoly, there is only one seller in the marketplace, which is almost impossible to enter. The product is unique, meaning there are no substitutes for it. Public utilities are an excellent example of monopolies. In a monopolistic competition, there are many sellers in the marketplace, which is extremely easy to enter. The products offered are similar to each other, but differentiated by style, design, price, or service provided. Retail products, like jeans, are excellent examples.