Market structure with many firms selling differentiated products, low barriers to entry, and some price-making ability.

Products that are similar but have perceived or actual differences, leading to brand loyalty and some price control.

Competition based on factors other than price, such as branding, advertising, and product features.

The difference between a firm's optimal output (minimum ATC) and its actual output in the long run.

A firm that has some control over the price it charges due to product differentiation.

Obstacles that prevent new firms from easily entering a market.

A state of the economy in which production represents consumer preferences; in particular, every good or service is produced up to the point where the last unit provides a marginal benefit to consumers equal to the marginal cost of producing.

A situation in which a good or service is produced at the lowest possible cost.

The minimum level of profit needed to keep a firm in an industry.

Total revenue less total cost, including both explicit and implicit costs.

Restaurants offer slightly different menus, branding, and atmospheres to attract customers and gain some price control.

Brands use advertising, design, and celebrity endorsements to differentiate their products and attract customers.

New coffee shops can easily enter the market, increasing competition and potentially reducing profits for existing firms.

Strong branding can make the demand curve more inelastic, as customers are more loyal and less sensitive to price changes.

Advertising increases a firm's costs, but it can also increase demand and revenue if successful.

More substitutes make the demand curve more elastic, as consumers can easily switch to alternatives if the price increases.

Firms produce less than the allocatively efficient quantity because they have some market power, leading to deadweight loss.

Superior customer service can differentiate a firm from its competitors, attracting and retaining customers.

Convenient or desirable locations can differentiate a firm, attracting customers who value accessibility.

Excess capacity indicates that firms are not producing at the lowest possible cost, contributing to inefficiency.

Monopolistic competition has differentiated products and some price control, while perfect competition has identical products and firms are price takers.

Monopolistic competition earns zero economic profit in the long run, while a monopoly can earn positive economic profit.

Monopolistic competition has low barriers to entry, while monopoly has very high barriers to entry.

Perfect competition is allocatively and productively efficient, while monopolistic competition is inefficient.

The demand curve is more elastic in monopolistic competition due to the availability of substitutes.

Monopolistic competition has many firms, while oligopoly has only a few dominant firms.

Monopolistic competition features product differentiation, which may or may not exist in oligopoly.

Advertising is a key strategy in monopolistic competition, while it is largely absent in perfect competition.

Monopolistically competitive firms have some control over price, while firms in perfect competition have no control.

Monopolistic competition produces less than the allocatively efficient quantity, while perfect competition produces at the allocatively efficient quantity.