Which of the following is a characteristic of an oligopoly?

Question

Firms have no market power.

A small number of firms control the majority of the industry.

Oligopoly is not a market structure that is frequently observed in the real world.

Each firm sells a standardized, homogeneous product.

Answer 1

The characteristic of an oligopoly from the options provided is:

A small number of firms control the majority of the industry.

In an oligopoly, a few firms dominate the market, which allows them to have significant market power and influence over prices and output levels. The other statements are incorrect as they do not accurately describe oligopoly characteristics.