Define or explain the following concepts:
3. Monopolistic Competition
Answer:
Monopolistic market structure is defined as the market structure where a large number of buyers and sellers engage in the exchange of differentiated products, i.e., products that are close substitutes of each other. Differentiated product is one of the unique features of the monopolistic market structure. For example, in the market of toilet soap, differentiated products are available under different brand names, which are close substitutes of each other but are not identical, such as Lux, Rexona, Cinthol, Lifebouy and Pears.
