Question

Under which market structure does the action of one firm have a spillover effect on the decisions of other firms?

-oligopoly
-perfect competition
-monopoly
-monopolistic competition

Answer 1

I believe the answer is: Monopoly

In monopoly, the power to determine the price of a certain type of product fall to the hands of a single company. Which means, every single actions that made by this company would force other firms to conform since they do not possess enough resources to challenge this controlling company.