In an oligopolistic market, there is likely to be

A) little consideration of the actions of rival firms.
B) price-taking behavior on the part of firms.
C) product homogeneity, not differentiation.
D) neither allocative nor productive efficiency.

Question

Sadonya Mosley · Accepted Answer

Final Answer : D, Explanation :  In an oligopolistic market, firms are highly interdependent, meaning they must consider the actions of their rivals when making decisions. Unlike in perfect competition, firms in oligopoly do not take the market price as given (price-taking behavior) but instead have some power to set prices. Oligopolies often involve product differentiation rather than homogeneity. Due to these characteristics, oligopolies can lead to outcomes that are neither allocatively nor productively efficient, as firms may not produce at the lowest possible cost or at quantities where price equals marginal cost.

In an oligopolistic market, there is likely to be

A) little consideration of the actions of rival firms.
B) price-taking behavior on the part of firms.
C) product homogeneity, not differentiation.
D) neither allocative nor productive efficiency.

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Learning Objectives

Related questions

In an oligopolistic market, there is likely to beA) little consideration of the actions of rival firms.B) price-taking behavior on the part of firms.C) product homogeneity, not differentiation.D) neither allocative nor productive efficiency.

Definitions

Learning Objectives

Learning Objectives

Related questions

In an oligopolistic market, there is likely to be

A) little consideration of the actions of rival firms.
B) price-taking behavior on the part of firms.
C) product homogeneity, not differentiation.
D) neither allocative nor productive efficiency.