Monopolistic Competition Topic Index

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Housing Starts

In a monopolistically competitive market, there are fewer firms than in a perfectly competitive market, and each firm can differentiate its product, such as through the use of advertising. Costs of entry by new firms is not as high as in oligopolistic markets. Builders in the home construction industry often times operate in a monopolistically competitive market. Builders have somewhat differentiated products and services, and it is not prohibitively expensive for new builders to enter the market.

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