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9 Cards in this Set
- Front
- Back
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oligopoly |
market structure in which there are only a few firms and firms explicitly take other firm's likely repose into account |
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characteristics of oligopoly |
few firms take other firms actions into account more likely to engage in strategic decision making mutually interdependent |
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strategic decision making |
taking explicit account of a rivals expected response to a decision you are making |
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cartel |
combination of firms that act as if it were a single firm |
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cartel model of an oligopoly |
oligopolies act as monopolies that have assigned output quotas to firms of the oligopoly so that total output is consistent with joint profit maximization
all firms follow uniform pricing policy that serves their collective interest |
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what happens when oligopolies limit entry of other firms and form a cartel? |
they increase profits going to the combination of firms in the cartel |
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the contestable market model |
model of oligopoly in which barriers to entry and exit not the structure of the market determine a firms price and output decisions |
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the higher the barriers... |
the more the price exceeds the cost |
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antitrust policy |
governments policy toward competitive process -judgement by performance -judgement by structure |
