Final answer:
The passenger airlines and breakfast cereal markets are examples of oligopoly because they are dominated by a few large firms. In contrast, the wheat market is more competitive and not oligopolistic, and the fast food industry, despite having major players, does not have high enough barriers to entry to be considered a pure oligopoly.
Step-by-step explanation:
An oligopoly is a market structure dominated by a small number of large firms, leading to high barriers to entry and firms that make strategic decisions based on the actions of their competitors. In such markets, these firms can either compete fiercely or collude to act like a monopolistic entity to maximize profits. When examining the options provided: fast food, passenger airlines, wheat, and breakfast cereal, we can determine which are oligopolistic.
The passenger airlines and breakfast cereal industries are examples of oligopolistic markets because they consist of a few large firms dominating the market. Airlines like Delta, United, and American Airlines control a large portion of the industry, similar to how Kellogg's, General Mills, and Post dominate the breakfast cereal market.
On the other hand, the wheat industry is more competitive with many producers, which makes it more akin to perfect competition rather than an oligopoly. The fast food industry, while having major players like McDonald's and Burger King, still has relatively low barriers to entry and significant competition, which may not make it a clear-cut example of an oligopoly.