The Theory of Oligopoly Suggests That

question 77

Multiple Choice

The theory of oligopoly suggests that

• A) entry into the industry is an important force preventing the exploitation of market power by existing firms.
• B) game theory is interesting theory but not useful for real corporate managers.
• C) the tendency toward joint maximization of profits is greater for a large number of sellers than for a small number of sellers.
• D) innovation is weak when there is no price competition.
• E) oligopoly may be the best of the feasible alternative market structures when major scale economies exist.

---

Definitions:

Half-lives

The time required for half of a particular substance or entity to undergo a process, such as radioactive decay.

Dike Unit

A geological feature consisting of a vertical or steeply inclined sheet of rock that formed from magma intruding into cracks or fissures within the earth's crust.

Mortality Table

A statistical table showing the probability of death for individuals at each age, used by insurance companies to determine premiums.

Probability

A measure of the likelihood that an event will occur, expressed as a number between 0 and 1, where 0 indicates impossibility and 1 indicates certainty.