Will the firms in an oligopoly act more like a monopoly or morelike competitors? Briefly...

Will the firms in an oligopoly act more like a monopoly or more like competitors? Briefly explain.

Expert Solution

Oligopoly is a market structure dominated by certain companies. When the market is shared among some companies, it is said to be highly concentrated. Even if only a few companies dominate, many smaller companies can operate in the market.

The firms in Oligopoly act like monopolies because competition is bad for oligopolies as by competing they behave like perfect competitors, reduce costs and make a profit for everyone. If oligopolies come together, they can operate effectively as a monopoly and succeed in raising prices and consistently making high profits.

Rahul Sunny answered 2 years ago

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3. What is the difference between oligopoly and monopoly?

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