Title: QUIZ: Introduction to Oligopoly
Course: Kelly's Copy-Export Course > Section: Introduction to Oligopoly

Q: What is an oligopoly?
- A market with many small businesses
- A market dominated by a few large businesses
- A market with no competition
- A market with perfect competition
A: A market dominated by a few large businesses

Q: Why do businesses in an oligopoly attempt to collude?
- To charge the same high price that a monopolist would charge and earn higher profits
- To charge a lower price than their competitors and earn higher profits
- To increase the quality of their product and increase sales and earn higher profits
- To save money on advertising costs and earn higher profits
A: To charge the same high price that a monopolist would charge and earn higher profits

Q: Why is collusion difficult to maintain in an oligopoly?
- Because businesses have no market power
- Because businesses don’t have clear ways to communicate with one another
- Because businesses have an incentive to lower prices for higher profits
- Because it is legal and encouraged
A: Because businesses have an incentive to lower prices for higher profits

Q: What happens to prices and quantities in an oligopoly compared to a monopoly?
- Prices are higher and quantities are lower than in a monopoly.
- Prices are lower and quantities are higher than in a monopoly.
- Prices and quantities are the same as in a monopoly.
- Prices are unpredictable and quantities are the same as in a monopoly.
A: Prices are lower and quantities are higher than in a monopoly.