Oligopoly arises with scale economies that are not large enough to cause a natural monopoly.

Question

Quizplus · Accepted Answer

Oligopoly refers to a market structure in which a small number of firms dominate the market, often leading to competition based on non-price factors such as advertising or product differentiation. This market structure can arise when there are scale economies that create barriers to entry, but these scale economies are not large enough to lead to a natural monopoly. Therefore, Option A - "True" is the correct answer.

Oligopoly Arises with Scale Economies That Are Not Large Enough