When oligopolies operate like firms in perfect competition,the firms produce at the point where the
A) price is less than the marginal cost.
B) marginal cost equals the price.
C) price exceeds the marginal cost by the greatest amount.
D) price equals the average total cost.
E) marginal cost equals the average total cost.

Question

Quizplus · Accepted Answer

When oligopolies operate like firms in perfect competition, they produce where marginal cost equals price, as this is the point of profit maximization. This is the same as in perfect competition, where firms also produce where marginal cost equals price.

When Oligopolies Operate Like Firms in Perfect Competition,the Firms Produce