The automobile industry is

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The automobile industry is an example of an oligopoly because it is dominated by a small number of large firms that have significant control over the market. In order to achieve low average costs, each firm must produce a large amount of output, making it difficult for new firms to enter the industry. Brand names are important in the industry, but this does not necessarily make it monopolistically competitive. The existence of economies of scale supports an oligopolistic market structure, rather than monopolistic competition. Legal reasons do not play a significant role in determining the market structure of the automobile industry.

The Automobile Industry Is