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In contestable markets large oligopolistic firms end up behaving like ?

A. monopolistically competitive firms

B. a cartel

C. perfectly competitive firms

D. a monopoly.

Related Questions on Profit Maximizing Under Perfect Competition & Monopoly Mcqs

The kinked demand curve model of oligopoly assumes the elasticity of demand ?

A. in response to a price increase is less elastic than the elasticity of demand in response to a price decrease

B. is perfectly elastic if price increases and perfectly inelastic if price decreases

C. is constant regardless of whether price increase of decrease.

D. in response to a price increases is more elastic than the elasticity of demand in response to a price decrease

In which of the following circumstances would a cartel be most likely to work ?

A. The market for copper, where there are very few producers and the product is standardized.

B. The fast-food market where there are a large number of producers but the demand for fast food is inelastic

C. The coffee market where the product is standardized and there are a large number of coffee growers.

D. The automobile industry, where there are few producers but there is great product differentiation.