Question

Which of the following goods are not likely to be sold in monopolistically competitive markets?

A. jeans

B. wrist watches

C. tap water for residents in a single city, say the city of West Fargo or Moorhead.

D. necklaces for women

Answer 1

Jeans wrist watches and necklaces can be considered as monopolistically competitive market structure because there are many players in the market where each sell a differentiated product and it is not very difficult to enter the market and that's the reason why

(A,B,D) are wrong.

because tap water for residents in a single city has only two companies West Fargo and Moorhead and the entry to the market is not very easy because of many restrictions it is not a monopolistic competition and rather it is a duopoly

Therefore (C) is the answer to this question