We can draw demand curves for firms in perfectly competitive and monopolistically competitive industries, but not for oligopoly firms. The reason for this is
A) there are no barriers to entry in perfectly competitive and monopolistically competitive industries. There are high barriers to entry in oligopoly industries.
B) we can assume that the prices charged by perfectly competitive and monopolistically competitive firms have no impact on rival firms. For oligopoly this assumption is unrealistic.
C) that perfectly competitive and monopolistically competitive firms are price takers. Oligopoly firms are price makers.
D) perfectly competitive and monopolistically competitive firms sell standardized products. Oligopoly firms sell differentiated products.
Answer: B
You might also like to view...
Which of the following formulas would you use to calculate the nominal wage rate?
A) nominal wage rate = real wage rate × CPI B) nominal wage rate = (real wage rate × CPI) × 100 C) nominal wage rate = (real wage rate × CPI) ÷ 100 D) nominal wage rate = (real wage rate ÷ CPI) × 100 E) nominal wage rate = real wage rate ÷ CPI
The incentive structure is a
A) system of rewards and punishments that individuals consider when making decisions. B) system determined by the federal government that gives certain states more federal funds. C) system of infrastructure in the United States that improves commerce. D) system of checks and balances in the government.