ECONOMICS (CBSE/UGC NET)

ECONOMICS

COMPETITION AND MARKET STRUCTURES

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Which type of market structures has few producers(companies) such as 2 or 3 and they have complete control over the price?Hint:think of the soda market
A
perfect competition
B
monopolistic competition
C
oligopoly
D
monopoly
Explanation: 

Detailed explanation-1: -Under Monopoly competition, there is only one firm producing the product. Being a single firm, there is complete control over the supply and price of the product. There is no substitute for the products produced by monopolistic firms.

Detailed explanation-2: -Oligopoly, in which a market is by a small number of firms that together control the majority of the market share. Duopoly, a special case of an oligopoly with two firms. Monopsony, when there is only one buyer in a market. Oligopsony, a market in which many sellers can be present but meet only a few buyers.

Detailed explanation-3: -An oligopoly is defined as a market structure with few firms and barriers to entry. Oligopoly = A market structure with few firms and barriers to entry. There is often a high level of competition between firms, as each firm makes decisions on prices, quantities, and advertising to maximize profits.

Detailed explanation-4: -Oligopoly means few sellers. In an oligopolistic market, each seller supplies a large portion of all the products sold in the marketplace. In addition, because the cost of starting a business in an oligopolistic industry is usually high, the number of firms entering it is low.

Detailed explanation-5: -In economic theory, perfect competition occurs when all companies sell identical products, market share does not influence price, companies are able to enter or exit without barriers, buyers have perfect or full information, and companies cannot determine prices.

There is 1 question to complete.