In an industry with a large number of firms,
A) competition is eliminated.
B) one firm will dominate the market.
C) collusion is impossible.
D) barriers to exit must exist.
E) each firm will produce a large quantity, relative to market demand.

Question

Quizplus · Accepted Answer

In an industry with a large number of firms, collusion is unlikely because there are too many firms to coordinate with each other. This leads to more competition and less control over the market by any one firm.

In an Industry with a Large Number of Firms