Economies of Scale Will Create a Barrier to Entry in an Oligopoly

question 189

Multiple Choice

Economies of scale will create a barrier to entry in an oligopoly industry when

• A)a firm's minimum efficient scale occurs where long-run average total costs are constant.
• B)the typical firm's long-run average total cost curve reaches a minimum at a level of output that is a large fraction of total industry sales.
• C)the typical firm's long-run average total cost curve reaches a minimum at a level of output that is a small fraction of total industry sales.
• D)the industry's four-firm concentration ratio is less than 40 percent.

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Definitions:

Related to Rewards

Pertains to the connection between actions or performances and the positive outcomes or incentives provided in return.

Mediators

Third-party individuals who intervene in disputes or negotiations to help reach a settlement or agreement, without having the authority to make a binding decision.

Challenge and Performance

The relationship where increased levels of challenges lead to higher performance if the individual is motivated and has the necessary skills.

Moderators

Variables that influence the strength or direction of the relationship between independent and dependent variables in research or analysis.