Oligopoly is similar to
A)perfect competition because both market types produce identical goods.
B)perfect competition because both firms in both market types make zero economic profit in the long run.
C)monopoly because both market types have barriers to entry.
D)monopoly because both market types have a single firm.
E)monopolistic competition because firms in both markets face a perfectly elastic demand.

Question

Quizplus · Accepted Answer

Oligopoly, like monopoly, has barriers to entry which restrict new firms from entering the market. Perfect competition, on the other hand, has a large number of small firms producing differentiated products and no barriers to entry. Therefore, option A, B, and E are incorrect. Option D is also incorrect as oligopoly has more than one firm, unlike monopoly which has a single dominant firm.

Oligopoly Is Similar to