Which of the Following Is a Distinguishing Characteristic of Oligopoly

question 34

Multiple Choice

Which of the following is a distinguishing characteristic of oligopoly?

• A) A large number of firms compete.
• B) No one firm's actions directly affect the actions of the other firms.
• C) Firms are free to enter and exit the industry.
• D) Natural or legal barriers prevent the entry of new firms.

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Definitions:

Joint Profits

Are the combined earnings of two or more entities, often used to evaluate the financial outcome of a partnership or merger.

Marginal Cost

The cost added by producing one additional unit of a product or service, a crucial concept in economic decision-making and pricing strategies.

Perfectly Competitive

A market structure where many firms offer a homogeneous product, there are no barriers to entry or exit, and all firms are price takers.

Oligopolistic

Oligopolistic refers to a market structure characterized by a small number of large firms dominating the market, leading to limited competition.