What is the effect of advertisement on monopolistic competition?

Answer 1

There is not much need for adverticement when one company has a monopoly over one product. It is only needed to remind the people this product exists and where they can buy it. There is no competition if you have monopoly.

If the product is coveted/needed/multiuseful usually one session of adverticing can result a rush to the store. This happened during war when there was lack of mostly anything. If you adverticed 'we have bread' you would advertice in a few moments 'we do not have bread'.

Answer 2

•Critics argue that advertising induces customers into spending more on products because of the name associated with them rather than because of rational factors.

•Defenders of advertising dispute this, arguing that brand names can represent a guarantee of quality and that advertising helps reduce the cost to consumers of weighing the tradeoffs of numerous competing brands.

Answer 3

Advertising under monopolistic competition is commonly used to achieve product differentiation and market control. By differentiating a specific product from the competition, a business gives the impression that their product is of higher quality, and can therefore charge a higher price.