Which of the following characterizes the market that Chipotl

Which of the following characterizes the market that Chipotle competes in?

Solution

The characteristic of the market that Chipotle competes in is (C) i.e barriers to entry are low. Option (A) is not a correct answer because the market for fast-casual restaurants do not have a horizontal demand curve. They have a downward sloping demand curve. Option (B) is incorrect because they sell distinguishable products and not identical products. Option (D) is incorrect because there are a large number of firms mainly due to the low barriers to entry. Hence the correct answer is (C).