Question

24) In the U.s. economy, a few firms dominate the wireless telephone provider Industry. Whlch type of

market structure does this represent? (SSEMT36 DOK: 2)
oligopoly
B. monopoly
C. pure competitilon
D. monopolistic competitlon

Answer 1

oligopoly

Step-by-step explanation:

An oligopoly is a market structure comprising a few firms dominating a large market with many buyers. The few firms sell similar or differentiated products. Each of the firms commands a sizable market share and can influence the market. Apart from the few dominating firms, there could be other small sellers with a smaller market share operating in the market. Another example of an oligopoly market is the air travel business, where a few airline companies dominate the market.

Characteristics of oligopoly market include

• Barriers to entry due to heavy capital requirements and market domination by a few firms.
• Each firm sets its price
• heavy advertising to woe clients
• Collaboration among the few dominating firms