The large businesses operating in an oligopoly benefit from lower cost

QUESTION

The large businesses operating in an oligopoly benefit from lower costs as the number of customers they serve increases. What is the term for this dynamic?

A) the equilibrium price point
B) perfect competition
C) producer sovereignty
D) economies of scale
E) managed competition

ANSWER

Answer: D
Explanation: D) Smaller businesses in this market cannot serve enough customers to benefit from this dynamic.