As the Number of Firms in the Oligopoly Grows Very

question 25

Multiple Choice

As the number of firms in the oligopoly grows very large, the

• A)output effect disappears.
• B)price effect disappears.
• C)output effect equals the price effect.
• D)price of the product greatly exceeds marginal cost.

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Definitions:

Accumulating Debt

The process of increasing debt through borrowing or the accumulation of interest on existing loans.

Corporation

A business organization that is a separate legal entity from its owners, the shareholders.

Tax Advantages

Financial benefits that arise from the application of tax laws, such as deductions or credits, which reduce tax liability.

Shareholders

Individuals or entities that legally own one or more shares of stock in a public or private corporation.