In an oligopoly, the total output produced in the market is

a. lower than the total output that would be produced if the market were a monopoly but higher than the total output that would be produced if the market were perfectly competitive.

b. higher than the total output that would be produced if the market were a monopoly and higher than the total output that would be produced if the market were perfectly competitive.

c. higher than the total output that would be produced if the market were a monopoly but lower than the total output that would be produced if the market were perfectly competitive.

d. lower than the total output that would be produced if the market were a monopoly and lower than the total output that would be produced if the market were perfectly competitive.

Question

Nikolai Myers

Business

15 August, 08:45

In an oligopoly, the total output produced in the market is

a. lower than the total output that would be produced if the market were a monopoly but higher than the total output that would be produced if the market were perfectly competitive.

b. higher than the total output that would be produced if the market were a monopoly and higher than the total output that would be produced if the market were perfectly competitive.

c. higher than the total output that would be produced if the market were a monopoly but lower than the total output that would be produced if the market were perfectly competitive.

d. lower than the total output that would be produced if the market were a monopoly and lower than the total output that would be produced if the market were perfectly competitive.

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Answers (1)

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Anton · Answer 1

Letter c is correct. Higher than the total output that would be produced if the market were a monopoly but lower than the total output that would be produced if the market were perfectly competitive.

Explanation:

An oligopoly is a market situation that occurs when there are a small number of companies that dominate the supply of a particular product or service in a sector of the economy. It can occur naturally or structurally, and the purpose of this market configuration is to have greater competition and price control, so that there is greater profitability.

This scenario is characterized by imperfect competition, which is similar to the monopoly market, but in oligopoly production is higher than in monopoly, because there is more than one supplier of the same product. And production in an oligopoly is lower than in a perfectly competitive scenario where there are many suppliers and none have the ability to affect market price.