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Q. What do you mean by Oligopoly?
Type of market condition that is most appropriate in the today's economy, is oligopoly. It's characterised by mutual interdependence among a few sellers who control total market supply. Oligopoly, thus, takes place when there are just a few sellers. It differs from both monopoly and perfect competition and from monopolist competition. Oligopoly is a market where small group of producers, have substantial control over major portion of market demand, with or without differentiated product.
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Suppose market demand and supply are given by Qd = 100 – 2P and QS = 5 + 3P. If a price floor of $20 is set, what will be the size of the resulting surplus?
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