The most common reason for the existence of oligopolies is
A) ease of entry.
B) economies of scale.
C) product homogeneity
D) advertising.

Question

Quizplus · Accepted Answer

Economies of scale allow firms to produce at lower costs per unit as they increase their production. This creates a barrier to entry for potential competitors, as they may not be able to achieve the same level of efficiency and cost savings. As a result, a few dominant firms can control a significant portion of the market, leading to an oligopoly.

The Most Common Reason for the Existence of Oligopolies Is