A distinguishing feature of an oligopolistic industry is the tension between
A)profit maximization and cost minimization.
B)cooperation and self interest.
C)producing a small amount of output and charging a price above marginal cost.
D)short-run decisions and long-run decisions.

Question

Quizplus · Accepted Answer

In an oligopolistic industry, there are a few large firms that dominate the market. These firms have the ability to collude and act together to maximize profits for the industry as a whole. However, each individual firm also has a strong self-interest to maximize their own profits, which can lead to tension and conflict within the industry. This tension between cooperation and self-interest is a distinguishing feature of oligopolies.

A Distinguishing Feature of an Oligopolistic Industry Is the Tension