Product Differentiation

Multiple Choice

Product differentiation:

A) refers to the attempt of firms to make their products look like those of the other firms in the industry and is used in a perfectly competitive market structure.
B) refers to the attempt of firms to make real or apparent differences in essentially substitutable products look different in the minds of the consumers and is used in a monopolistically competitive market structure.
C) leads to nonprice competition in a perfectly competitive market structure.
D) leads to price equaling the minimum average total cost in the long run in a monopolistically competitive market structure.