Question:
An industry with a small number of firms producing a standardized or differentiated product could be called
(1) a competitive industry.
(2) an oligopoly.
(3) a monopolistically competitive industry.
(4) a monopoly.
(5) a pure competition.
Correct Answer:
(2)
Answer Explanation:
An oligopoly is fundamentally defined as a market structure dominated by a “small number of large sellers” (a few firms). These dominant firms can produce either identical, standardized products (like a pure oligopoly in steel or cement) or highly differentiated products (like a differentiated oligopoly in automobiles or smartphones).
Topic: Market Structures Year: 2019
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