Oligopolists are more sensitive to the pricing and output policies of their rivals when
A)all firms produce identical products
B)their products are highly differentiated
C)there is freedom of entry and exit
D)there are barriers to entry
E)there are many firms in the industry

Question

Quizplus · Accepted Answer

Oligopolists are more sensitive to rivals' pricing and output when products are identical, as changes by one firm can directly affect the market share and profits of others.

Oligopolists Are More Sensitive to the Pricing and Output Policies