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Convenience stores with gas stations tend to sell an essentially identical variety of products and services....

Convenience stores with gas stations tend to sell an essentially identical variety of products and services. Yet this is generally considered to be a monopolistically competitive industry selling differentiated products. How can this be considered a differentiated product?  

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Answer #1

Convenience stores do sell many goods that are almost identical but they also sell many other goods that have slight variations. In addition, these stores charge a slightly higher price for the products they sell because they provide additional utility because of their location and access (close to gas station). Due to this reason, they represent a market that has many sellers but with slight market power and with slight product variation so that they are monopolistically competitive.

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