Which of the following statements about oligopolies is not correct?
A)An oligopolistic market has only a few sellers.
B)The actions of any one seller can have a large impact on the profits of all other sellers.
C)Oligopolistic firms are interdependent in a way that competitive firms are not.
D)Unlike monopolies and monopolistically competitive markets, oligopolies prices do not exceed their marginal costs.

Question

Quizplus · Accepted Answer

Oligopolies, like monopolies, can set prices above marginal costs due to their market power and the limited number of competitors. This allows them to achieve higher profits, unlike in perfectly competitive markets where prices tend to equal marginal costs.

Which of the Following Statements About Oligopolies Is Not Correct