Which of the following is a defining characteristic of an oligopoly?
A)A large number of sellers
B)Mutual interdependence between firms
C)Economies of scale in production
D)A large number of buyers

Question

Quizplus · Accepted Answer

Mutual interdependence between firms is a defining characteristic of an oligopoly. This means that the actions of one firm will have a significant impact on the other firms in the market, which leads to strategic decision-making and competition between the firms.

Other options are incorrect:
A) An oligopoly is characterized by a small number of sellers, not a large number.
C) While economies of scale may exist in an oligopoly, it is not a defining characteristic.
D) The number of buyers is not a defining characteristic of an oligopoly.

Which of the Following Is a Defining Characteristic of an Oligopoly