Differentiate between perfect competition and an oligopoly?
A) Firms in an oligopoly earn economic profit in the long run, whereas firms in perfectly competitive market earn zero economic profit in the long run.
B) Firms in an oligopoly charge a lower price than firms in a perfectly competitive market.
C) Firms in an oligopoly face horizontal demand curves, whereas firms in a perfectly competitive market face downward-sloping demand curves.
D) An oligopoly is characterized with low barriers to entry, whereas a perfectly competitive market is characterized with high barriers to entry.
E) There are many firms in an oligopoly, whereas there are only a few firms in a perfectly competitive market.
Correct Answer:
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