Firm A is concerned about the reactions of buyers to the price it sets for its product. Firm B is concerned about the reactions of buyers and its few rivals to the price it sets for its product. Firm C has no control over the price at which its product is sold. Firms A, B, and C are, respectively:
A) a monopolistic competitor, an oligopolist, and a pure competitor.
B) an oligopolist, a monopolistic competitor, and a pure competitor.
C) a monopolistic competitor, a pure competitor, and an oligopolist.
D) a pure competitor, an oligopolist, and a monopolistic competitor.

Question

Quizplus · Accepted Answer

Firm A, concerned about buyer reactions but not competitors, is a monopolistic competitor. Firm B, concerned about both buyers and a few rivals, is an oligopolist. Firm C, with no control over pricing, is a pure competitor.

Firm a Is Concerned About the Reactions of Buyers to the Price