Asked by imaani Johnson on May 25, 2024
Verified
Oligopoly is characterized by all of the following except
A) some industries that produce identical products.
B) frequent price wars.
C) high barriers to entry.
D) prices that are above the minimum of the ATC curve.
Price Wars
A competitive exchange among rival companies where prices are successively lowered to undercut competitors, often leading to reduced profit margins.
ATC Curve
Average Total Cost Curve, a graphic representation that shows the cost per unit of output produced.
Barriers to Entry
Factors that make it difficult for new firms to enter a market, such as high startup costs, stringent regulations, or strong competition from existing firms.
- Gain an understanding of the distinguishing features of oligopolies and their significance in economic contexts.
- Assess how oligopolies affect market competitiveness and consumer pricing.
Verified Answer
FF
Farah FayadMay 27, 2024
Final Answer :
B
Explanation :
Price wars are not characteristic of oligopoly markets. In fact, oligopolists often emphasize non-price competition, such as advertising and product differentiation, to maintain market share and avoid costly price wars.
Learning Objectives
- Gain an understanding of the distinguishing features of oligopolies and their significance in economic contexts.
- Assess how oligopolies affect market competitiveness and consumer pricing.