Question: 1. How does monopolistic competition differ from perfect competition in its basic characteristics? From monopoly? Explain fully what product differentiation may involve. Explain how the

1. How does monopolistic competition differ from perfect competition in its basic characteristics? From monopoly? Explain fully what product differentiation may involve. Explain how the entry of firms into its industry affects the demand curve facing a monopolistic competitor and how that, in turn, affects its economic profit. [LO12.1]

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