What market structure does an oligopoly resemble as the number of sellers increases ?
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Answer: B. a competitive market
Explanation
An oligopoly approaches competitive market behavior as seller numbers grow. Individual firm market power diminishes with a larger number of competitors. Market dynamics shift away from collusion toward competitive pricing. Oligopolies feature strategic interaction among a small group of firms. As firms enter the market, collective pricing control breaks down. Competitive markets represent the limit as firm numbers become very large.
Antitrust authorities encourage new market entrants to increase competition. Industries with many competing firms prevent monopolistic price gouging. Market structure analysis helps economists regulate imperfect competition. Option A suggests the market resembles a monopoly with more sellers. Option C incorrectly specifies monopolistic competition instead of pure competition. Option D assumes collusion increases with more sellers in the market.
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