In an oligopolistic market, prices will tend to be closer to the competitive price:
1. the greater the number of sales.
2. the more government regulation there is in the market.
3. the greater the number of firms in the industry.
4. when the product is more distinguishable from its competitors.
Answer: 3. the greater the number of firms in the industry.
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Explain why a tax increase on cigarettes in one state might not lead to a substantial price increase for all consumers in that state
What will be an ideal response?
Which of the following examples illustrates a conglomerate merger?
a. an automobile manufacturer merges with a steel producer b. a food service contractor merges with a search engine c. a soda producer merges with another soda producer d. a shoe retailer merges with a leather producer
In the above graph, as you move from point B to point C,
A. the amount of capital increases and the amount of labor decreases. B. cost is unchanged. C. output is unchanged. D. both b and c E. all of the above
Exhibit 8-8 A firm's cost and marginal revenue curves
In Exhibit 8-8, product price in this market is fixed at $35. This firm is currently operating where MR = MC. What do you advise this firm to do?
A. This firm should shut down. B. This firm could increase profits by increasing output. C. This firm could increase profits by decreasing output. D. This firm should continue to operate at its current output.