Monopolistic competition in an industry will result in _____ because firms produce _____.

A) overutilization of plants;the minimum-cost output
B) less advertising than in perfect competition;the minimum-cost output
C) lower prices than in perfect competition;more than the minimum-cost output
D) chronic excess capacity;less than the minimum-cost output

Monopolistic Competition

A market structure featuring many firms selling products that are similar but not identical, allowing for competition based on quality, price, and marketing.

Chronic Excess Capacity

A persistent situation in which industries or firms have more production capacity available than is being used, often leading to economic inefficiencies and reduced profit margins.

Minimum-Cost Output

The quantity of output at which the average total cost is lowest—the bottom of the U-shaped average total cost curve.