Question

What is the trademinus−off that consumers face when buying the product of a monopolistically competitive​ firm?

A. Consumers pay higher prices but the products are produced by highly efficient firms.

B. Consumers pay a price greater than marginal​ cost, but have the luxury of choices more suited to their tastes.

C. Consumers pay higher prices but receive better quality goods compared to the output of perfectly competitive firms.

D. Consumers pay lower prices but have fewer choices.

Answer 1

Option b is correct

Step-by-step explanation:

They benefit from product choice which is close to their taste, monopolistic firms do not achieve productive efficiency.