Due to the fact that it does not produce at the minimum of its average cost curve or where P = MC, a monopolistically competitive company is inefficient.
What makes you say "monopolistic"?
having complete control over something or striving to do so, especially over a corporate sector, without allowing anyone else to participate: She didn't believe that the fine would be sufficient to prevent monopolistic practices by major firms. The company is accused of engaging in monopolistic activity.
Why does a business become monopolistic?
When one firm and its product control a whole sector of the economy, there is little to no competition and customers are forced to buy the particular product or service from the one company. A limited number of businesses, as opposed to simply one, form an oligopoly
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