Cost of firm A is lower than firm B Profit maximizing price and quantity of firm A is PA and XA respectively. Keep its price constant and thus decrease its market share C. Increase its price and thus increase its market share D. Decrease its price and thus decrease its market share 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. 4. When the government grants patents to, for example, three different pharmaceutical companies that each has its own drug for reducing high blood pressure, those three firms may become an oligopoly. A) all members of the cartel have a strong incentive to abide by the agreed-upon price. What happens to oligopolistic firms when a recession occurs? Strategic independence. An oligopoly is a market structure where a few large firms collude and dominate a particular market segment. 0. Because of their large size and minimal competition, each firm in an oligopoly market structure influences the others. c) Price war Mutual interdependence solely means that they base their decisions on how they think their rivals will react. The characteristics of oligopoly include interdependence, product differentiation, high barriers to entry, uncertainty, price setters. c) price leadership; cartel All right then. All firms stick to what has been decided, thereby ensuring price stability in the sector. Interdependence: The foremost characteristic of oligopoly is interdependence of the various firms in the decision making. E) the firms are interdependent. When this structure is in place for an economy, then only a small number of producers, distributors, and sellers interact with the customer base to distribute items. It is used as one of the strategies to increase the business firm's revenue and increase the market share.read more. It continues to behave on the assumption that its new demand (d 1 d' 1 ) will not shift further because the effect of its own decisions on other sellers' demand would be negligible. A) equilibrium price and quantity will be sensitive to small cost changes. Each firm faces a downward-sloping demand curve. The policy implementation process has not taken in to account the life of rural peasants living in vicinity of cities. In the credit card industry, for example, Visa and MasterCard have a duopoly.read more. c) kinked-demand 16) A monopolistically competitive firm is like an oligopolistic firm insofar as A) both face perfectly elastic demand. $3. B) in a single-play game but not a repeated game. What would have been DTRs debt to equity ratio if the$10 million of stock had not been c) harder Marilyn b) depends on the firm's cost structure 4) According to the kinked demand curve theory of oligopoly, each firm thinks that demand just below the price at the kink is A) less elastic than the demand just above the price at the kink. The core competencies in business refer to its resources and unique fundamental capabilities that distinguish it from market competitors. E) none of the above is done. Here, they focus on each other and try to exceed customer expectations in every possible way. Oligopoly: Definition, Characteristics and Concepts - Toppr-guides Oligopoly Defined: Meaning and Characteristics in a Market - Investopedia
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