Suppose there are only four airlines that service the air route between two cities. If there is a barrier to entering the market (such as a limited number of gates), the market is best characterized as:
A) a pure monopoly.
B) monopolistically competitive.
C) oligopolistic.
D) perfectly competitive.

Question

Quizplus · Accepted Answer

The market is best characterized as oligopolistic because there are only a few firms (four airlines) and barriers to entry, such as limited gates, which prevent new competitors from easily entering the market.

Suppose There Are Only Four Airlines That Service the Air