Multiple Choice
Which of the following is an assumption made in the model of pure monopoly?
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12. Monopoly
Characteristics of Monopoly
Multiple Choice
Which type of industry is characterized by a limited number of competing firms?
A
Perfect competition
B
Oligopoly
C
Monopoly
D
Monopolistic competition
Verified step by step guidance1
Understand the characteristics of different market structures: Perfect competition, Monopoly, Monopolistic competition, and Oligopoly.
Recall that perfect competition involves many firms with identical products, so it does not have a limited number of firms.
Recognize that a monopoly has only one firm dominating the entire market, which is not a limited number but a single firm.
Identify that monopolistic competition has many firms selling differentiated products, so it also does not have a limited number of firms.
Conclude that an oligopoly is characterized by a few firms dominating the market, which means it has a limited number of competing firms.
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