Have you used ketchup? Have you bought ketchup in a supermarket? Consider the characteristics of market structures and decide to which the ketchup industry belongs.
A) oligopoly because it represents competition among the few
B) monopolistic competition because the demand curves for each brand is horizontal
C) perfect competition because the good is identical (ketchup is ketchup)
D) monopoly because the firm demand curve is the industry demand curve
E) monopoly because there are no good substitutes

Question

Quizplus · Accepted Answer

BThe ketchup industry is characterized by oligopoly because a few large firms dominate the market, but it also exhibits traits of monopolistic competition due to product differentiation—each brand of ketchup has its own perceived qualities and branding, leading to a downward-sloping demand curve for each brand, contrary to the horizontal demand curve assumption.

Have You Used Ketchup? Have You Bought Ketchup in a Supermarket