Question

What are contestable markets? Can contestable markets be competitive when there is room for only one or two rival firms?

Answer 1

Contestable market are the markets in industry where few Rivals compete with each other to survive and perform well in the market and to capture the market share as maximize the can

They differentiate in terms of products ,advertisements promotions etc.

there are few barriers to entry as well to enter in these markets due to to the barrier created by the rivals.

yes contestable market even can be competitive when there is room for only one or two Rival firms because in this the dominant firm will have a better strategy on market and share as compared to other firms