Question

1. Is the firm Discount Tire operating in a competitive, oligopoly, cartel, monopolistic competition or a monopoly market structure. Why?

Answer 1

Discount Tire actually operating in a oligopolistic market structure and this is because of the fact that this is a tire retailer where there are only handful of tyre retailers which are well known in the United States where the graph of the most market share and it is very difficult to entry because all the firms present have a subsequent amount of market share making it difficult to enter and capture the brand loyalty where its competitors include Costco, Tirerack.com etc. Because there are not many players in the market and there are various to entry it can be mentioned that this is an oligopolistic market structure