Because each individual firm produces a somewhat unique product
each firm faces a downward sloping demand curve. Even if a competitor
charges a slightly lower price a monopolistically competitive
firm won't lose all sales since some will still be willing to
pay a little more for that firms somewhat unique product. If a
firm lowers prices it won't take all business always from its
competitors either, some will still prefer the other "brand."
so the demand curves are downward sloping.
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