Unlike in other markets, under oligopoly, to make the decision about price and q
ID: 1123505 • Letter: U
Question
Unlike in other markets, under oligopoly, to make the decision about price and quantity produced, a firm has to take into account-------------
costs and revenues alone
purely subjective estimates of human traits such as stubbornness, loyaty, patience, and anger
discretionary fiscal policy actions by the government
size of the firm, new plant location
a.costs and revenues alone
b.purely subjective estimates of human traits such as stubbornness, loyaty, patience, and anger
c.discretionary fiscal policy actions by the government
d.size of the firm, new plant location
Explanation / Answer
The oligopoly firms while making decisions about prices and quantity produced, takes into account the size of the firm and new firm location.
This is because in oligopoly there are few large firms which capture the entire market. Therefore while making decisions about the price and quantity, firm size and new plant location are important.
Hence option d is the correct answer.
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