4.1.5.5 Oligopoly notes

What is a defining characteristic of oligopolistic markets?

• A single firm dominates the market

• There is perfect information symmetry

• There are few firms and high barriers to entry

• All firms produce identical products

How can oligopoly markets be defined?

• By the level of government intervention

• By the number of products offered

• By market structure or market conduct

• By the geographic location of firms

What is the difference between collusive and non-collusive oligopoly?

• Collusive oligopoly involves price fixing, non-collusive does not

• Non-collusive oligopoly involves a single firm, collusive involves many

• Collusive oligopoly is legal, non-collusive is illegal

• Non-collusive oligopoly focuses on product quality, collusive on marketing

What does the kinked demand curve model illustrate in an oligopolistic market?

• Price elasticity is consistent across products

• Firms will not change prices due to mutual interdependence

• Consumer preference is irrelevant

• Government policies dictate pricing

Which factor is a reason for non-price competition in oligopolistic markets?

• Uniform product quality

• High consumer loyalty to brands

• Operation of cartels

• Reduced marketing efforts

What is the significance of interdependence in oligopolistic industries?

• It leads to frequent price wars

• It diminishes the role of advertising

• It creates uncertainty in decision-making

• It encourages individual firm independence

What is a potential advantage of oligopoly?

• Increased market competition

• Lower product prices

• Enhanced product differentiation

• Reduced consumer choice

What is a key characteristic of oligopolistic markets regarding the number of firms involved?

• A large number of small firms

• A small number of large firms

• No dominant firms

• Unlimited number of firms

How do firms in an oligopolistic market typically compete?

• Solely on price

• Through government intervention

• Only through product quality

• Through non-price factors such as advertising and innovation

What does 'Ease of Entry' refer to in the context of oligopolistic markets?

• The ability of firms to exit the market

• The ability of new firms to enter the market

• The regulation of market prices

• The number of products offered by the firms