What is product differentiation? When a firm practises product differentiation, what is the effect of a rise in price? Question content area bottom Part 1 Product differentiation _______. A. is making a product slightly different from the products of competing firms B. occurs when two firms in an industry buy their factors of production from different suppliers C. is improving the quality of the product D. occurs when a firm tries to increase its market share by lowering the price of the good it produces Part 2 When a firm practises product differentiation, a rise in price _______. A. the quantity demanded decreases to zero B. decreases the quantity demanded but not necessarily to zero C. other firms in the market also raise prices D. demand becomes perfectly elastic