12th Class Economics Solved Paper - Economics 2017 Delhi Set-I

  • question_answer
    Explain the 'free entry and exit of firms' feature of monopolistic competition.


    Monopolistic competition is a form of market in which large number of sellers sell different kind of product.
                There is a difference in their Trade. Mark, Brand Name, packaging, etc. the commodities produced by firms are close substitute of one another.
    \[\begin{align}   & \text{Free Entry and Exit of firms} \\  & \,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\Downarrow  \\ \end{align}\]
                The new firms to enter into a market and the existing firms can leave the market as per their own willingness but sometimes, they face a monopolist restriction i.e., Cartel.

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