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Question
Explain the meaning of the following features of the Oligopoly Market :
(a) Non-Price Competition
(b) Few Sellers
Solution
The features of the Oligopoly Market are explained as follows:
- Non-Price Competition: Oligopoly firms tend to ignore price competition. They stress on the non-price competition. They adopt a policy of aggressive non-price competition. The products of the firms in oligopoly markets have the same price.
- Few Sellers: There exist few but large and dominating firms. These firms account for the majority of market supply, thereby control the market price and quantity of the output.
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