On the other hand, if an oligopolist reduces output by raising prices, the rest refrain from doing so. Segn Ricardo no es posible que exista equidad en el mercado debido a que: A. C) "Construction prices in this town seem to be always set by Big Jim's Dandy Construction Company." Answers: 1 Show answers Another question on Social Studies. d) vertical price changes, not production costs, so it can't be b. Which of the following is not a characteristic of an oligopoly? b) greater than or equal to 50% B) a market where two firms compete for profit and market share. B) both firms comply with the agreement. 2) In the dominant firm model of oligopoly, the larger firm acts like The value denotesthe marginalrevenue gained. c) Price war c) Affect costs and influence the supply of rival firms If this occurs, then the firm's demand curve will look ______. Demand Curve is a graphical representation of the relationship between the prices of goods and demand quantity and is usually inversely proportionate. Characteristics: There are few firms in the market serving many consumers. B) "Every time Sparrow's Donuts has a donut sale, so does Tim Horton's." E) Each firm has an incentive to cheat. Libertyville has two optometrists, Dr. Smith and Dr. Jones. E) an oligopoly. C) firms in monopolistic competition. Strategic independence. c) An outcome in the payoff matrix from which neither firm wants to deviate since the current strategy is optimal given the rival's strategic choice. B) the firms may legally form a cartel. Thus, it induces interdependence in the network. Oligopoly is said to prevail when there are few firms or sellers in the market producing or selling a product. C) one prisoner has no chance to be acquitted since there is no other prisoner to support his testimony. An oligopoly is an industry dominated by a few large firms (Few sellers supplying, many buyers). E) the firms are interdependent. B) interdependence of firms. a) is needed in d) They do not achieve allocative efficiency because their price exceeds marginal cost. d) strategic theory. True or false: Firms in an oligopoly always produce a homogeneous product. East Asian regimes tend to have similar characteristics First they are orien. So when an oligopolist decreases prices to increase output, others follow the path. *It lowers search costs of information for consumers. c) They move leftward and upward to a higher point on the average-total-cost curve. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); Copyright 2023 . Pure because the only source of market power is lack of competition. Which of the following is not a characteristic of oligopoly? Oligopoly Models: 1. b) are few in number It determines the law of demand i.e. 300 laborers were employed at the plant that month. In short,AI oligopoly is all set to shape the market, comprising a few large AI service providers dominating and influencing others in the business. B) of barriers to entry. The existence of oligopoly requires that a few firms are able to gain significant market power, preventing other, smaller competitors from entering the market. 0. Based on the figure, if one firm cheats on the collusive agreement it can increase its payoff by It thus limits the competition to only those already in the group. E) Firms set prices. What are the positive effects of large oligopolists advertising? a) Kinked-demand curve model E) marginal revenue curve is upward sloping. Mutual interdependence solely means that they base their decisions on how they think their rivals will react. they will make more pricing low than if they both price high. Therefore, necessarily they tend to react. All right then. When two major players dominate a sector, the market becomes a duopolyDuopolyWhen there are two market leaders in any industry or service, this is referred to as a duopoly. b) interindustry competition D) patents, copyrights, barriers to entry, and rules. 11) Once a cartel determines the profit-maximizing price, Which scenario describes a simultaneous game? Oligopolies exist and do not attract new rivals because A) of competition. A) suggests that price will remain constant even with fluctuations in demand. It also means that each firm must be aware of the reaction of others to their actions. An oligopoly in economics refers to a market structure comprising multiple big companies that dominate a particular sector through restrictive trade practices, such as collusion and market sharing. a) its rivals do not respond to either a price cut or price increase D) Bob denies and Art confesses. Oligopolists seek to maximize market profits while minimizing market competition through non-price competition and product differentiation. Why do the elements of structure, such as work specialization, formalization, span of control, chain of command, and centralization, have a tendency to change together? It is difficult to enter an oligopoly industry and compete as a small start-up company. homogeneous or differentiated products i. ENGL1190_V0854_2023WI_Communications23.docx. b) Strategies are chosen for a single time period. B) both prisoners deny. Business Economics Consider a Cournot oligopoly with n = 2 firms. Mr. mann's science students were experimenting with speed. is the demand curve for taxi rides in a town, and, 14) Refer to Figure 14.1.1. Besides, high capital requirements, licensing, patents, market demand, economies of scale, limit-pricing, and customer loyalty restrict the entry of new businesses. B) total revenue. d) Affect costs and influence the products of rival firms, a) Affect profits and influence the profits of rival firms, Which of the following is a model used to examine oligopolistic pricing? Interdependence E) more elastic than the demand just above the price at the kink. a) They move downward and to the right to a lower operating point on the average-total-cost curve. They believe in making customers stick to their brands for core competenciesCore CompetenciesThe core competencies in business refer to its resources and unique fundamental capabilities that distinguish it from market competitors. Two different industries can have the same the four-firm concentration ratio, yet the amount of monopoly power of each of the firms in the two industries can be drastically different. *It enhances competition and reduces monopoly power. a) are less efficient due to competition 4. land back or when DTRs debt to equity position improves, what should she do? East Asian regimes tend to have similar characteristics First they are orien. In third-degree price discrimination happens when customers are segregated by . D. El desempleo voluntario hace que no se produzca el crecimiento econmico. 8) A weakness of the kinked demand curve theory of oligopoly is that it does not a) Affect profits and influence the profits of rival firms A) the government will impose price controls. E) a cartel. A) Each firm faces a downward-sloping demand curve. d) price changes are often difficult to match bc it's similar to monopoly but has the difference of having more firms lol. a) price leadership b) The number of employees in an industry who ever have or are currently working for one of the four largest firms a) price changes occur slowly *It helps reduce demand for material products. (Enter one word per blank. Click the card to flip Definition 1 / 84 always one step ahead. A small number of sellers. Sometimes there may be many firms but the large share of the industrys productive capacity is accounted for only by a few firms, the others share will be insignificant as far as the market is concerned. a) kinked and steep b) The Herfindahl model But in practice, there are several barriers to entre which make it quite difficult for the new firms to join the industry or market. Which is the simple form of oligopoly market? A) a Competition Tribunal. C) rules, strategies, profit, and outcome. 0. B) the courts. The distinctive feature of an oligopoly is interdependence. b) It will always be downward sloping because it is a price maker. What kind of problem does this represent with the four-firm concentration ratio? B) marginal cost curve is discontinuous. 12) Because an oligopoly has a small number of firms a) The possibility of price wars diminishes and profits are maximized. at least $10 million. c) kinked b) it will lower the firm's costs b) are few in number E) unknown. single family housing and would be an attractive site for single family homes. b) price leadership; collusion *providing misleading information The marketers of Budweiser Light beer and Miller Lite beer must decide whether or not to offer new advertising campaigns promoting their products. c) The supply curve model Economics questions and answers. If the products of the firms are differentiated the degree of interdependence is then weakened. D) All of the above. A type of implicit understanding used by oligopolists to coordinate prices without engaging in outright collusion is known as ______. c) Nash equilibrium What are the 4 characteristics of oligopoly? Firm B adopts this price and sells XB(