A market situation when many firms sell similar but not identical prod

A market situation when many firms sell similar but not identical products is termed as

perfect competition
imperfect competition
monopolistic competition
oligopoly
This question was previously asked in
UPSC CDS-1 – 2019
Monopolistic competition is a market structure characterized by a large number of firms selling products that are similar but differentiated. Product differentiation allows firms some degree of market power, but the large number of competitors limits this power. This description directly matches the definition provided in the question.
– Many firms.
– Products are similar but not identical (differentiated).
– Characterizes monopolistic competition.
– Perfect competition: Many firms, identical products.
– Oligopoly: Few firms, products can be identical or differentiated.
– Imperfect competition: A general term encompassing market structures where perfect competition does not hold, including monopolistic competition, oligopoly, and monopoly.