The Conclusion That Oligopoly Is Inefficient Relative to the Competitive

question 87

Multiple Choice

The conclusion that oligopoly is inefficient relative to the competitive ideal must be qualified because

• A) industry price leaders often select a price equal to marginal cost.
• B) over time oligopolistic industries may promote more rapid product development and greater improvement of production techniques than if they were purely competitive.
• C) increased output due to persuasive advertising may perfectly offset the restriction of output caused by monopoly power.
• D) many oligopolists sell their products in monopolistically competitive or even purely competitive industries.

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Specialized Role

A position that requires a specific set of skills or expertise unique to a particular job or context.

Deliberate Influence

The intentional exertion of power or effect on others to bring about desired outcomes.

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