Firms in an oligopoly oftenQuestion 40 options:a) Have no control over the price of their product. b) operate without regard to the behavior of competing firms. c) face perfectly elastic demand curves. d) make decisions based on the behavior or expected behavior of their competitors.

d) make decisions based on the behavior or expected behavior of their competitors.

Explanation:

An oligopoly can be defined as a market structure comprising of a small number of firms (sellers) offering identical or similar products, wherein none can limit the significant influence of others.

Hence, it is a market structure that is distinguished by several characteristics, one of which is either similar or identical products and dominance by few firms.

The characteristics of an oligopolistic market structure are;

I. Mutual interdependence between the firms.

II. It's a market that is typically controlled by many small firms.

III. Difficult entry to new firms.

Firms that are operating in an oligopoly often make their decisions based on the behavior or expected behavior of their competitors (rivals) in the same market.

d) make decisions based on the behavior or expected behavior of their competitors.

Explanation:

Firms in an oligopoly often make decisions based on the behavior or expected behavior of their competitors.

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