Which of the following is similar for oligopoly and monopolistic competition?
A)Both have many firms.
B)Both have low concentration ratios.
C)Both have market power.
D)Both make independent production decisions.

Question

Quizplus · Accepted Answer

Both oligopoly and monopolistic competition have market power, meaning that they can affect the price of their products or services. In oligopoly, a few large firms dominate the market, while in monopolistic competition, there are many small firms that differentiate their products to compete with each other. Both types of market structures are characterized by firms having some degree of market power. A is incorrect because oligopoly has only a few firms, while monopolistic competition has many firms. B is incorrect because oligopoly can have high concentration ratios, while monopolistic competition typically has low concentration ratios. D is incorrect because in oligopoly, firms often make decisions interdependently, while in monopolistic competition, firms make independent production decisions.

Which of the Following Is Similar for Oligopoly and Monopolistic