Question

1-Why are firms in oligopoly​ interdependent?

Firms in oligopoly are interdependent because​ _______.

A.

each​ firm's actions influence the profits of all the other firms

B.

an oligopoly market has barriers to entry

C.

each firm produces a very small percentage of the market output

D.

the average total cost curve is​ downward-sloping along the relevant range of output

2-A natural monopoly is a monopoly that arises because one firm can meet the entire market demand at a lower average​ _____ cost than two or more firms could.

A legal monopoly is a market in which​ _____ by the granting of a public​ franchise, government​ license, patent, or copyright.

A.

​variable; costs are minimized

B.

​total; competition and entry are restricted

C.

​variable; profts are maximized

D.

​fixed; competition and entry are restricted

Answer 1

1) The correct option is: A) each​ firm's actions influence the profits of all the other firms.

Firms operating under conditions of oligopoly are said to be interdependent, which means they cannot act independently of each other. A firm operating in a market with just a few competitors must take the potential reaction of its closest rivals into account when making its own decisions

2) The correct option is: B) total; competition and entry are restricted.

A market structure characterized by a single seller, selling a unique product in the market. In a monopoly market, factors like government license, ownership of resources, copyright and patent and high starting cost make an entity a single seller of goods