Individual profit earned by Dave,the oligopolist,depends on which of the following?

Question

Quizplus · Accepted Answer

All three factors mentioned in (i), (ii), and (iii) impact the individual profit earned by an oligopolist like Dave.

(i) The level of output produced by the oligopolist affects their profit as it determines the quantity of goods available for sale and the market price at which they can be sold.

(ii) The pricing decisions of the other oligopolists in the market impact the profit earned by Dave as it affects the overall market price and demand for the goods produced by all the oligopolists.

(iii) Any cost-saving measures or innovations implemented by Dave can also impact the profit earned by him by reducing the cost of production and increasing margins.

Therefore, all three factors together determine the individual profit earned by an oligopolist like Dave.

Individual Profit Earned by Dave,the Oligopolist,depends on Which of the Following