A contestable market is one in which there are
A) one or a few firms, and entry into the market is costly.
B) one or a few firms, and entry into the market is not costly.
C) many firms, and entry into the market is costly.
D) many firms, and entry into the market is not costly.

Question

Quizplus · Accepted Answer

A contestable market is characterized by the absence of barriers to entry and exit, meaning that even if there are one or a few firms, new firms can enter the market without significant costs.

A Contestable Market Is One in Which There Are