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CA Foundation Oligopoly — practice questions

Explore 12 free Oligopoly questions in CA Foundation Business Economics. Open each question or exercise to read its content, reference answers and available explanation.

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Oligopoly questions and exercises with answers

Showing questions 1–12 of 12.

Under perfect competition, the degree of interdependence between firms is:Read the answer and worked solution →An oligopoly is a market where pricing control lies with:Read the answer and worked solution →Under kinked demand, a price cut by one firm is met by rivals that:Read the answer and worked solution →A pure oligopoly is one where firms produce:Read the answer and worked solution →Firms selling heterogeneous commodities form which kind of oligopoly?Read the answer and worked solution →A closed oligopoly is one with:Read the answer and worked solution →Cartel stability is limited because members tend to:Read the answer and worked solution →Which measure shows the market share of the top four firms in an industry?Read the answer and worked solution →Oligopolists often compete on terms other than price because such competition is:Read the answer and worked solution →Which one is a recognised oligopoly model?Read the answer and worked solution →One possible outcome of oligopoly rivalry that cuts prices sharply is a:Read the answer and worked solution →Why is there no interdependence in a monopoly?Read the answer and worked solution →

Worked practice questions

Under perfect competition, the degree of interdependence between firms is:

  1. Very strong
  2. Mildly strong
  3. Completely nil
  4. Strongly one-way
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Correct answer: C. Completely nil

No firm is large enough to affect the market price, so rivals do not need to watch each other's moves.

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An oligopoly is a market where pricing control lies with:

  1. A single seller
  2. Many small sellers
  3. A single buyer
  4. A few sellers
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Correct answer: D. A few sellers

The word oligopoly comes from Greek for few sellers.

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Under kinked demand, a price cut by one firm is met by rivals that:

  1. Ignore the cut
  2. Raise prices
  3. Match the cut
  4. Leave the market
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Correct answer: C. Match the cut

Rivals match the cut, so the firm's sales rise only slightly and demand below the kink is inelastic.

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More Business Economics topics

Price-Output Determination under Different Market FormsTheory of Consumer BehaviourSupplyTheory of ProductionProduction And CostPublic FinanceBusiness CyclesBasic Problems of an Economy and Role of Price Mechanism