Which of the Following Is TRUE of an Oligopoly

question 213

Multiple Choice

Which of the following is TRUE of an oligopoly?

• A) They engage in nonprice competition.
• B) They do not react to actions of their competitors.
• C) Each firm produces a small portion of the total output.
• D) Firms do not care what their competitors do.

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Definitions:

Present Value

The value as of now of a future amount of money or subsequent cash flows, based on a chosen return rate.

Compound Interest

Interest that is determined by taking into account not only the original principal of a deposit or loan but also all the interest that has been compounded in previous cycles.

Earnings Rate

The return on an investment or the amount of profit made compared to the amount of money invested.

Internal Rate of Return

An investment’s projected rate of return, calculated by finding the discount rate that sets the net present value of all cash flows (both positive and negative) to zero.