Question

What is one of the main differences between a monopoly and an oligopoly?
A. Oligopolies face downward sloping demand curves, unlike monopolistic firms. B. An oligopoly is a market situation where there are no close substitutes for the good.
C. Firms in oligopoly can set prices to a degree but must consider other firms' decisions.
D. There are barriers to entry for firms in a monopolistic but not in oligopolistic markets.

Answer 1

C. seems to be the closest to the correct answer.

C gets close to the analysis that collusion is common in oligopolies as collusion is (illegal) but easier than competition

A is incorrect as oligopoly has a kinked, not downward sloping curve.

Oligopoly is a market structure where there are limited options for producers, but there are options. So, B is incorrect.

There are barriers to entry in both monopolies and oligopolies so D is incorrect.