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:

Bona Fide Occupational Qualification

An employment practice that allows for consideration of traits or characteristics that are normally considered discrimination if they are genuinely necessary to the normal operation of a particular business.

Equal Pay Act

A U.S. law aimed at abolishing wage disparity based on sex by ensuring that men and women receive equal pay for equal work.

Substantially the Same Job

A position that is nearly identical in duties, responsibilities, and requirements to another job, typically in the context of employment law and workplace equality.

Seniority System

A seniority system is an organizational structure where employees gain certain benefits or positions based on their length of service.