In the long run,an oligopolist is most likely to
A)Experience economic profits when sufficient barriers to entry are present.
B)Experience zero economic profits because barriers to entry do not exist in the long run.
C)Produce at the most technically efficient output level due to long-run competition.
D)Face a straight demand curve.

Question

Quizplus · Accepted Answer

Oligopolies are characterized by few large firms that dominate the market. Because of this, there are often significant barriers to entry that prevent new firms from entering the market and competing with existing firms. In the long run, an oligopolist with sufficient barriers to entry is likely to continue experiencing economic profits, as there are no new firms to drive down prices and reduce profits.

In the Long Run,an Oligopolist Is Most Likely to