In the absence of price-fixing, a monopoly will make more total profit than an oligopoly operating in an identical market.

Question

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In a monopoly, the company has complete control over the market, allowing them to charge a higher price and earn more total profits. In an oligopoly, there are multiple firms competing, which can lead to price competition and lower profits for each company. However, if the oligopoly firms engage in price-fixing, they could potentially earn higher profits at the expense of consumers.

In the Absence of Price-Fixing, a Monopoly Will Make More