Question

Jack, Jamie, Ronnie, and Stephan own the only computer software manufacturing companies in the country. When Jack increases the price of his product and advertises extensively to promote it, the other three manufacturers immediately increase their prices and launch promotional strategies. What type of market structure do these four companies operate in

Answer 1

Answer: Perfect Competition

Explanation:

This is a situation prevailing in a market in which buyers and sellers are so numerous and well informed that all elements of monopoly are absent.

Answer 2

Answer:

Oligopoly

Explanation:

Oligopoly is a type of market structure in which few number of firms control or collectively dominate a market. Each of the few firms in an Oligopoly can exact a significant influence on the others in their pricing and output policies. Usually, an Oligopoly market structure is controlled by two or more few number of firms having a firm grip on the market share, who compete with each other.