In the market for batteries, _________. A. the HHI is greater than 2,500, and the market is a monopoly B. many firms with an i
ncentive to collude produce batteries, and the market is an oligopoly C. a small number of interdependent firms influence the profits of each other, and the market is an oligopoly D. no barriers to entry exist and each firm produces an identical battery so the market is perfectly competitive
1 answer:
Answer:D
Explanation: A perfect competition is characterised by identical product and no barriers to entry. Products are perfect subsistuites.
The HHI index is used to measure the market power and therefore concentration of firms in the market.
An index less than 1000 indicates the firm isn't concentrated
An index between 1000-1800 indicates moderate concentraruon
An index of over 1800 indicates high concentration
An oligopoly is when there are a few numbers of firms in a market that are interdependent.
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