A characteristic common in both oligopoly and monopolistic competition is
A) a small number of firms compete in the market.
B) natural or legal barriers prevent the entry of new firms into the market.
C) each firm faces a downward-sloping demand curve.
D) the firms in the market are interdependent.
E) each firm has a large share of the market.

Question

Quizplus · Accepted Answer

In both oligopoly and monopolistic competition, firms face a downward-sloping demand curve, indicating that they can influence the price of their product to some extent by adjusting the quantity they produce or sell. This contrasts with perfect competition, where firms are price takers, and monopoly, where there is only one firm.

A Characteristic Common in Both Oligopoly and Monopolistic Competition Is