Question map
Not attempted Correct Incorrect ★ Bookmarked
Loading…
Q94 (CDS-II/2014) Economy › Basic Concepts & National Income › Market structure types Answer Verified

A market in which there are large numbers of sellers of a particular product, but each seller sells somewhat differentiated but close products is termed as

Result
Your answer: —  Â·  Correct: C
Explanation

A market structure characterized by a large number of sellers offering differentiated but close products is termed monopolistic competition. Unlike perfect competition, where firms sell identical (homogeneous) products and act as price takers [1], monopolistic competition involves product differentiation through branding, quality, or features. This differentiation allows each firm to have some degree of market power over its price, as its product is not a perfect substitute for others. However, because there are many sellers and products are closely related, competition remains intense. In contrast, a monopoly features a single seller with no close substitutes, and an oligopoly consists of a few large firms that are highly interdependent. Monopolistic competition thus combines elements of both monopoly (product uniqueness) and competition (many sellers).

Sources

  1. [1] Microeconomics (NCERT class XII 2025 ed.) > Chapter 4: The Theory of the Firm under Perfect Competition > 4.1 PERFECT COMPETITION: DEFINING FEATURES > p. 53
How others answered
Each bar shows the % of students who chose that option. Green bar = correct answer, blue outline = your choice.
Community Performance
Out of everyone who attempted this question.
100%
got it right
✓ Thank you! We'll review this.

SIMILAR QUESTIONS

CDS-II · 2020 · Q35 Relevance score: 2.20

A market, in which there are a large number of firms, homogeneous product, infinite elasticity of demand for an individual firm and no control over price by firms, is termed as________.

CDS-I · 2022 · Q62 Relevance score: 1.90

Which of the following factors signify monopolistic competition ? 1. Differentiated products 2. Large number of buyers and sellers 3. Barriers to entry 4. Homogeneous products Select the correct answer using the code given below :

CDS-I · 2019 · Q15 Relevance score: -0.34

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

CDS-I · 2020 · Q100 Relevance score: -1.64

Match List-I with List-II and select the correct answer using the code given below the Lists: List-I (Market structure) A) Perfect B) Monopoly C) Monopolistic D) Oligopoly List-II (Characteristic) 1) Only one competition producer selling one commodity 2) Few producers selling similar or almost similar products 3) Many producers Competition selling Differentiated products 4) Many producers selling similar products Code:

IAS · 2022 · Q96 Relevance score: -3.20

With reference to foreign-owned e-commerce firms operating in India, which of the following statements is/are correct ? 1. They can sell their own goods in addition to offering their platforms as market-places. 2. The degree to which they can own big sellers on their platforms is limited. Select the correct answer using the code given below :