Oligopoly Flashcards
1
Q
How many firms in an oligopoly?
A
Five or fewer firms with at least 50% of market concentration ratio
2
Q
How high are the barriers to entry in oligopoly?
A
Very high but not as high as monopoly
3
Q
What do oligopolists aim to maximise?
A
Profit
4
Q
What kind of demand curve does oligopoly have?
A
downward sloping
5
Q
Are products differentiated or homogeneous in Oligopoly?
A
Differentiated.
6
Q
Are firms price makers or price takers In Oligopoly?
A
Price makers but interdependent between oligopolists
7
Q
In what scenarios (‘runs’) can abnormal profit be made in an Oligopoly?
A
Both long run and short run
8
Q
What are the ways Oligopolists compete?
A
Price wars Predatory Pricing Limit Pricing Price Leadership Non-Price Competition
9
Q
What are the ways Oligopolists collude?
A
Overt Collusion
Tacit Collusion
