How do equilibrium prices in markets characterized by oligopoly compare with those in monopolies and perfectly competitive markets
A)They are higher than in monopoly markets and higher than in perfectly competitive markets.
B)They are higher than in monopoly markets and lower than in perfectly competitive markets.
C)They are lower than in monopoly markets and higher than in perfectly competitive markets.
D)They are lower than in monopoly markets and lower than in perfectly competitive markets.

Question

Quizplus · Accepted Answer

Equilibrium prices in markets characterized by oligopoly are typically lower than in monopoly markets but higher than in perfectly competitive markets. This is because oligopolies have some ability to influence prices due to their market power, but they also face competition from other firms in the market. As a result, they tend to have higher prices than perfectly competitive markets but lower prices than monopolies.

How Do Equilibrium Prices in Markets Characterized by Oligopoly Compare