Oligopolies that produce identical products such as steel have no control over t

Question

Oligopolies that produce identical products such as steel have no control over the price of their product because of the availability of perfect substitutes. no control over the price of their product because of the large number of buyers in the market. some control over the price of their product because each firm sells a substantial share of the market. some control over the price of their product because of the small number of buyers in the market. Which statement is true? Most firms in the United States are oligopolies. Oligopoly is illegal in the United States. Product differentiation is the most important characteristic of oligopoly. Big business or industry in the United States typically refers to oligopolies. Which of the following represents an illegal control of prices? Colluding Following the leader without explicit agreements to do so Following the price determined by an analysis of supply and demand Accepting a government mandated price without contesting it A cartel is generally legal in the United States. a group of firms acting under collusion to control output and maximize group profits. similar to a monopolistically competitive industry. a group of firms acting like a perfectly competitive industry. Oligopolies are industries containing only a few large firms whose decisions are consciously linked. and each faces a horizontal demand curve. that can ignore other firms' reactions as they price, produce, and market their goods. but each firm is small relative to the market. An oligopolist must be very sensitive to its rivals because there are so many that their actions are unpredictable. the government doesn't regulate oligopolists when it comes to colluding on prices and quantities. there are so few that their behavior may well have consequences for the firm. oligopolists try not to use non-price competition since it seems to be unfair to the consumer.

Explanation / Answer

(11) (C)

Large firm size gives the firms some control over their price.

(12) (D)

(13) (A)

Collusion is an illegal price control.

(14) (B)

It's the definition of cartel.

(15) (A)

In oligopoly, price/output decisions of the firms are interdependent.

(16) (C)

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