GK
BUSINESS ECONOMICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Two monopoly firms
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Two firms are independent as regards their price-output decisions
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Two firms are interdependent as regards their price-output decisions
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None of the above
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Detailed explanation-1: -What Is a Duopoly in Economics? A duopoly exists when two companies dominate a market for a given product or service. A duopoly can have the same impact on the market as a monopoly if the two players collude on prices or output.
Detailed explanation-2: -As firms under duopoly are independent, they, therefore, employ strategies. The competing firm also make plans to contract and makes decisions about output and price of the good keeping in view the strategy of its rivals. The plans made by these firm, are known as game strategies.
Detailed explanation-3: -Characteristics of Duopoly There are two producers on the market. Because both producers serve a large number of customers, their bargaining power is strong. Producers are highly strategically dependent. One company’s strategic activities and decisions have a big influence on its opponent.
Detailed explanation-4: -A duopoly market is where there are two sellers and a large number of buyers are known as. An oligopoly market is where there are few sellers and a large number of buyers. A bilateral monopoly is where there are a single buyer and one seller in the market. Let us learn more about the Market Structure.