An Oligopolistic Firm That Is Deciding the Price to Charge

question 31

Multiple Choice

An oligopolistic firm that is deciding the price to charge, the output to produce, or the quality of product to offer, must consider

• A) the regulatory price limits that are always present with oligopoly.
• B) the potential reactions of rivals in the market.
• C) the fact that per-unit costs will usually increase as the scale of production increases.
• D) that entry barriers into oligopolistic markets are low.

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Definitions:

Cogency

The quality of an argument being convincing or persuasive due to the truth of its premises and its logical structure.

Inductive Argument

Reasoning in which the premises seek to supply strong evidence for (not absolute proof of) the truth of the conclusion.

Strawberries

A red, sweet, juicy fruit having a seed-covered surface, grown on certain species of the genus Fragaria.

Deductive Argument

A form of reasoning in which a conclusion is reached based on premises believed to be true, and the conclusion logically follows from these premises.