Characteristics of oligopoly, Managerial Economics

Assignment Help:

Oligopoly can be characterized as follows:

  • Small Number of Sellers: There are more than one sellers of a product though; the number isn't so huge in order to produce perfect competition of monopolistic competition.
  • Interdependence of Sellers: All the sellers are dependent on one another. They aren't free to establish their own marketing and price policies. Activities of one seller have an effect on others.
  • Homogenous product: Product of all the sellers is identical or a close substitute to one another.
  • Uniformity of Price: All the sellers adopt a uniform price policy because of the uniformity of their product.
  • Price Rigidity: As the activities of all sellers are inter-reliant, sellers prefer not to change the price of their product too frequently. For that reason market price tends to be steady.
  • Entry and Exit of Firms: The entry and exit of organisations is relatively difficult due to non-availability of raw materials, labour, etc.
  • Inconsistency in Firms: All the organisations operating in a market aren't precisely similar to one another. One organisation could be tiny and another organisation could behuge.
  • Uncertainty of Demand Curve: Demand curve is extremely erratic. An organisation can't predict its demand curve without difficulty since it's extremely difficult to predict whether or not competitors will change their policies of organisations. It is furthermore extremely difficult to predict the level of such changes. For this reason, demand curve of an oligopoly organisation is constantly erratic.

 


Related Discussions:- Characteristics of oligopoly

Consumption function, The Consumption Function The consumption functio...

The Consumption Function The consumption function is the relationship  [expressed in mathematical or diagrammatic form] between planned consumption and other independent varia

Progressive tax, PROGRESSIVE TAX A progressive income tax system is on...

PROGRESSIVE TAX A progressive income tax system is one where the higher the income, the greater the proportion paid in taxes.  This is effected by dividing the taxpayers' inco

What do you mean by legal monopoly, Q. What do you mean by Legal Monopoly? ...

Q. What do you mean by Legal Monopoly? Legal Monopoly: Some monopolies are engendered and protected under various laws. Inventors of new processes, devices or articles attain

Short run cost function, how much output should a firm produce? 80$ per uni...

how much output should a firm produce? 80$ per unit C(Q)=40+8Q+2Qsquared

Currency swaps, Currency Swaps If the currency of one country is not c...

Currency Swaps If the currency of one country is not convertible, the central banks o f the two countries can exchange their currencies, and the country with the non-convertib

Many dollars of change in consumption, Given a saving function of S = -25 +...

Given a saving function of S = -25 + .2Yd, a $10 billion enhance in government spending will bring about how many dollars of change in consumption?

What is risk and production analysis, What is Risk and Production analysis ...

What is Risk and Production analysis Risk analysis:  Various models are used to quantify risk and asymmetric information and to employ them in decision rules to manage risk.

Equilibrium price, For the pair of supply and demand equations,where x repr...

For the pair of supply and demand equations,where x represents the quantity demanded in units of a thousand and p the unit price in dollars, find the equilibrium quantity and the e

Assignment question, define scarcity and opportunity cost.Show how these co...

define scarcity and opportunity cost.Show how these concept are useful in managerial decision making

Mba programme, write a note on marris growth maximising model?

write a note on marris growth maximising model?

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd