Introduction to Economics 1 Deneme Sınavı Sorusu #726958

Suppose that there are only three airline companies in Turkey and this industry is characterized with large economies of scale due to fixed costs and small and constant marginal costs. What kind of market structure is given above?


Monopolistic competition

Dominant strategy

Monopoly

Oligopoly

Duopoly


Yanıt Açıklaması:

Oligopoly is a market structure where there are only a few firms in the market due to barriers to entry. For example, the GSM market in Turkey is composed of three firms: Turkcell, Avea and Vodafone. This industry is characterized with large economies of scale due to fixed costs and small and constant marginal costs. The Correct Answer is D. 

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