Firms in _____ markets have a more difficult time applying the profit-maximization rule than firms in other markets because _____.
A) perfect competition; it is so difficult to keep track of the vast number of competitors
B) monopoly; there are no competitors
C) monopolistic competition; the barriers to entry are low
D) oligopoly; the firm's demand curve depends on the decisions of rival firms

Question

Quizplus · Accepted Answer

In oligopoly markets, firms face interdependence with a few other firms, making it challenging to apply the profit-maximization rule because a firm's demand curve and pricing decisions are significantly influenced by the actions of these rival firms.

Firms in _____ Markets Have a More Difficult Time Applying