Which of the following is true for an oligopoly but not for...

Which of the following is true for an oligopoly but not for perfect competition? I. There are a few firms, each with a large market share. II. The firms in the industry are interdependent. III. The industry experiences diseconomies of scale? II only I, II, and III III only I only I and II

The mutual interdependence that characterizes oligopoly arises because: the products of various firms are homogeneous. the products of various firms are differentiated. a small number of firms produce a large proportion of industry output. the demand curves of firms are kinked at the prevailing price. If there are significant economies of scale in an industry, then: a firm that is large may be able to produce at a lower unit cost than can a small firm. a firm that is large will have to charge a higher price than will a small firm. entry to that industry will be easy. firms must differentiate their products to earn economic profits. Game theory can be used to demonstrate that oligopolists: rarely consider the potential reactions of rivals. experience economies of scale. that oligopolists can increase their profits through collusion. may be either homogeneous or differentiated.

Jennifer S.