In the model of oligopoly,there:
A) are many firms producing differentiated products.
B) is one firm producing undifferentiated products.
C) are a few firms producing differentiated or undifferentiated products.
D) are many firms producing undifferentiated products.
E) is one firm producing a highly differentiated product.

Question

Quizplus · Accepted Answer

In the model of oligopoly, there are a few firms producing either differentiated or undifferentiated products. This is because in an oligopoly market, the barriers to entry are high and the market is dominated by a small number of large firms who can influence the market price. These firms may produce similar products, but they differentiate their products to attract customers and gain a competitive advantage. Alternatively, they may produce undifferentiated products and compete on price. Therefore, C is the best choice.

In the Model of Oligopoly,there