The Theory of Oligopoly Provides Another Reason That Free Trade

question 64

Multiple Choice

The theory of oligopoly provides another reason that free trade can benefit all countries because

• A)increased competition leads to larger deadweight losses.
• B)as the number of firms within a given market increases, the price of the good decreases.
• C)as the number of firms within a given market increases, the profit of each firm increases.
• D)All of the above are correct.

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Definitions:

Enjoyment

The state or process of taking pleasure in something, often leading to feelings of happiness and satisfaction.

Conditioned Response

A reflex developed through training in response to a stimulus that is typically neutral.

Unconditioned Response

An automatic, natural reaction to a stimulus that occurs without any need for prior learning.

Unconditioned Stimulus

An innate trigger that spontaneously and effortlessly evokes a reaction without the need for previous learning.