Many businesses operate in an environment that is â€monopolistically competitive.â€ Economic profits are possible in this setting, as we learned in Chapter 13, but only to the extent that a firm can continue to differentiate itself from competitors or produce goods at a lower cost than competitors. Starbucks, for example, recently announced that it plans to sell beer and wine after 4 p.m. in some markets. This certainly sets it apart from other coffee shops.
Please complete the following learning portfolio assignment for this chapter:
Identify a company that operates in a monopolistic competition environment.
List the monopolistic competition assumptions and explain how the business fits within these assumptions.
Make a suggestion for how this company could set itself apart from the competition.