If competitive market circumstances are such that there are few sellers who are sensitive to each other's prices, and the purpose of advertising is to inform but avoid price competition, then ________ must exist in the industry.
A) a pure monopoly
B) monopolistic competition
C) pure competition
D) an oligopoly
E) oligopolistic competition

Question

Quizplus · Accepted Answer

An oligopoly exists when there are few sellers in the market who are sensitive to each other's pricing strategies, and advertising is used to inform consumers while avoiding direct price competition.

If Competitive Market Circumstances Are Such That There Are Few