Question

Examine the market for cell phone providers in South Africa and answer the questions that follow:

a. Into which market structure do cell phone service companies fall?
b. Provide ONE reason to motivate your answer in a.
c. Calculate the total revenue generated by the oligopolist after price fixing.

Answer 1

Answer:Cell Phone Market Structure is an Oligopoly:

Explanation:This because the competitors in this market uses strategic moves in order to get ahead of the influence caused by the other competitors in the same market ,which make them be sellers who are price setters.rivals can cause collision and that influences their decisions.

The total revenue refers to price times quantity simply put:

total revenue=pricexquantity

=8x10

=80

Since they said after price fixing this means after the time when the supply was equal to the demand.

Answer 2

The market structure that cellphone service falls into is an oligopoly. This is because telco service providers are only a few the barrier to enter the market is high. The companies can also achieve short run and long run profit. After price fixing, the oligopolist generated lesser total revenue.