Which of the following statements is true of oligopolies?

Question

Quizplus · Accepted Answer

Oligopolies are characterized by a small number of dominant firms in a particular industry, and they tend to stifle competition. This is because the limited number of firms often leads to a lack of price competition, as the firms can collude to keep prices high. Additionally, the barriers to entry for new firms are often high in oligopolistic markets, making it difficult for new competitors to enter and compete effectively. While oligopolies can offer a range of product options, the lack of competition can lead to less innovation and fewer consumer choices in the long run. Oligopolies are not considered illegal in and of themselves, although antitrust laws may be used to address any anticompetitive behavior.

Which of the Following Statements Is True of Oligopolies