Oligopolists Are More Sensitive to the Pricing and Output Policies

question 211

Multiple Choice

Oligopolists are more sensitive to the pricing and output policies of their rivals when

• A)all firms produce identical products
• B)their products are highly differentiated
• C)there is freedom of entry and exit
• D)there are barriers to entry
• E)there are many firms in the industry

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Definitions:

U.S. Supply Shock

An unexpected event that suddenly changes the supply of goods or services in the U.S. economy, potentially affecting prices and leading to economic adjustments.

National Wage Rates

Standardized wage levels set or analyzed across a nation for various occupations or sectors, which can be influenced by government policy or economic conditions.

Real Exchange Rate

The exchange rate adjusted for inflation, indicating the purchasing power of a currency relative to another in terms of goods and services.

Purchasing Power

The worth of a currency depicted by how many goods or services can be purchased with one unit of it.