The correct answer is: C. Easy entry into and exit from the industry.
Monopolistic competition is a market structure in which there are many sellers of a differentiated product. This means that each seller has a small share of the market, but there are enough sellers that no one seller has a monopoly. The products sold by the different sellers are similar, but not identical. This means that consumers have some choice about which seller to buy from.
Easy entry into and exit from the industry is a characteristic of monopolistic competition. This means that it is relatively easy for new firms to enter the market and for existing firms to exit the market. This is because there are no significant barriers to entry or exit.
A few sellers, a differentiated product, and high barriers to entry are characteristics of an oligopoly. A monopoly is a market structure in which there is only one seller of a good or service.
Here is a more detailed explanation of each option:
- A. Few sellers is not a characteristic of monopolistic competition. In monopolistic competition, there are many sellers.
- B. A differentiated product is a characteristic of monopolistic competition. In monopolistic competition, the products sold by the different sellers are similar, but not identical. This means that consumers have some choice about which seller to buy from.
- C. Easy entry into and exit from the industry is a characteristic of monopolistic competition. This means that it is relatively easy for new firms to enter the market and for existing firms to exit the market. This is because there are no significant barriers to entry or exit.
- D. All of the above is not the correct answer. As explained above, option A is not a characteristic of monopolistic competition.