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Monopsony

A market situ...

Question

A market situation in which there are only few firms producing slightly differentiated products which are close substitutes is _______.

A

monopolistic competition

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B

oligopoly

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C

duopoly

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D

perfect competition

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Solution

The correct option is B oligopoly
An oligopolistic market structure is where few large firms control the majority of the market and can choose to collude to influence the price charged and behave as a monopoly. One of the most famous cartels is OPEC, they collectively influence the world market price of oil.

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