Swadee's Jewelry is one of 600 makers of ruby rings in Thailand. The rings display differences across the companies because each jewelry company has its own designs. Swadee is the fourth-largest producer of ruby rings in Thailand and sells 15% of the ruby rings in the market. Which statement is descriptive of the structure of the ruby ring market in Thailand?

Question

Quizplus · Accepted Answer

The presence of 600 makers indicates a competitive market, but Swadee's significant 15% market share and the mention of differentiated products (each company has its own designs) suggest characteristics of monopolistic competition. The fact that a few firms, including Swadee, have significant market shares also introduces elements of an oligopoly, but the large number of firms and product differentiation lean more towards monopolistic competition.

Swadee's Jewelry Is One of 600 Makers of Ruby Rings