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JAMB Economics 2006 Question 43

Question 43

Market Structures

The market structure in which there is interdependence of price-output policies is

  1. A.a pure monopoly
  2. B.an oligopoly
  3. C.a pure competition
  4. D.a monopolistic competition
Show the answer and explanation

Answer: B (an oligopoly)

Explanation

In an oligopoly a few firms dominate, so each must consider how rivals will react to its price and output decisions.