Question

The American automobile industry was historically dominated by "The Big Three," referring to General Motors, Ford, and Chrysler. However, as many more foreign competitors began influencing this market, the American companies had to modify and differentiate their products. The automobile industry moved from a(n) ____ structure to a(n) ____ structure.

Answer 1

The automobile industry moved from an oligopolistic structure to a monopolistic competition structure.

Step-by-step explanation:

During the year 1937 the American auto manufacturing industry was controlled by General Motors, Ford, and Chrysler referred as the "Big Three". By 1937 the big three had 90 percent of the business in the U.S. market, had a controlled firm oligopoly.

By 1990s Japan auto makers had already captured the market, the "Big Three" market share dropped by 70 percent. Today the" Big three" occupies the 58.7 percent of the U.S. market. General Motors still holds the largest share in the U.S. market by 27.35 percent.

Oligopoly: A market structure with more than two firms, none of these can prevent others from having significant influence.

Monopolistic competition: Imperfect competitions in which the firms sells similar products but not perfect substitutes.