State any two differences between Monopolistic competition and Perfect competition.

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answered Jul 21, 2020 by BhusanKumar (49.5k points)
selected Jul 21, 2020 by AlokKumar

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Basis	Perfect Competition	Monopolistic Competition
Nature of Product	The Product is homogeneous,i.s. , it is identical in all respects like size,shape, quality, etc.	The product is differentiated on the basis of brand, size, colour, shapes, etc.
Selling Cost	No need for selling cost as firms products homogeneous products.	Selling costs are incurred because firms produces differentiated products.
Price	Firm is a price-taker.	Firms has partial control over price due to product differentiation.
Demand Curve	Demand curve is perfectly elastic as price remains the same at all levels of output.	Demand curve slopes downwards as more output can be sold at less price.