Question

The Dealey Electric Group produces light bulbs that are used in refrigerator manufacturing. Currently, only three other companies produce bulbs used in the production of refrigerators, with Dealey as the leader in market share.
In this case, Dealey Electric Group would be considered:

A. a monopoly.
B. involved in perfect competition.
C. involved in monopolistic competition.
D. involved in a perfect oligopoly.
E. an oligopoly.

Answer 1

Answer: Oligopoly

Explanation:

The market type being described in the question is an oligopolistic market, where Dealey electric group and three other companies are in control of bulb production.

An oligopolistic market is a market where sales is being controlled by a very few number of companies and the prices of commodities in that market are also controlled by those companies.