Which assumption is NOT shared by oligopoly models?
A) Firms produce homogeneous products.
B) A few dominant firms exist in the industry.
C) Firms are mutually interdependent.
D) There are significant barriers to entry into the market.

Question

Quizplus · Accepted Answer

Oligopoly models do not necessarily assume that firms produce homogeneous products. In fact, many oligopolies exist where firms produce differentiated products, and this differentiation is a key aspect of competition within the market. The other options (B, C, D) are common assumptions or characteristics of oligopoly models, including the existence of a few dominant firms, mutual interdependence among these firms, and significant barriers to entry that prevent new competitors from easily entering the market.

Which Assumption Is NOT Shared by Oligopoly Models