Why demand curve face monopolistically competition
Why is demand curve facing a monopolistically competitive firm probable to be very elastic?
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Answer: This is because the products generated by monopolistically competitive firms are close substitutes to one other. When products are close substitutes to one other the elasticity of demand is high, that is what makes the firm’s demand curve (that is, under monopolistic competition) much elastic.
Price discrimination: The Price discrimination is a situation whenever a monopolist charges distinct price from various buyers of the similar product. This is usually done to maximize profits.
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