According to the video, which market structure category is the car market best described as?

Question

BlackTom AI · Accepted Answer

An oligopoly is characterized by a small number of large firms that together hold a large share of the market, face significant barriers to entry, produce differentiated (but sometimes similar) products, and make pricing and output decisions strategically in response to rivals. These core concepts identify the car market’s structure.

1) Relevant knowledge points and concepts
- Number of sellers: oligopoly = few large firms; perfect competition = many small firms; monopoly = one; monopolistic competition = many firms with differentiated products.
- Barriers to entry: oligopolies have high fixed costs, brand loyalty, and scale advantages.
- Product differentiation and strategic interaction: firms in oligopoly differentiate by features/branding and anticipate rivals’ actions (non‑price competition, advertising).
- Price rigidity and potential for collusion: oligopolistic firms may avoid price wars.

2) Step-by-step reasoning
- Count of major sellers: the global car industry is dominated by a relatively small set of manufacturers (e.g., Toyota, Volkswagen, General Motors, Hyundai-Kia, Stellantis, etc.), so it is not “many small firms.”
- Barriers to entry: extremely high capital costs, complex supply chains, regulatory standards, and dealer networks prevent easy entry.
- Product differentiation and strategic behavior: firms compete via design, technology (EVs), branding, warranties and marketing rather than purely on price. They watch and react to rivals’ moves.
- Market outcomes: price rigidity, strategic launches, and occasional tacit or explicit coordination are consistent with oligopoly theory.

3) Calculations
- No numerical calculation is required; the classification is qualitative.

4) Why the correct answer is correct
Given the small number of dominant producers, high entry barriers, product differentiation, and interdependent decision‑making, the car market fits the oligopoly model.

5) Why other options are incorrect
- Monopolistic competition: implies many firms and low entry barriers — not true for autos.
- Perfect competition: requires many sellers of identical products and price-taking — not applicable.
- Monopoly: requires single seller — clearly not the case.

Conclusion: The best description is b. Oligopoly, which matches the provided answer.

According to the video, which market structure category is the car market best described as?单项选择题

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According to the video, which market structure category is the car market best described as?单项选择题

类似问题

A market structure in which there is only one supplier and there are substantial, potentially insurmountable, barriers to new entrants is known as:

Which of the following best describes a market where dealers provide liquidity by buying and selling stocks for themselves?[Fill in the blank]

When two or more large firms form a cartel, the price of products would_______ and the output would_______________. This collusive behaviour more likely leads to a/an____________ in the level of efficiency.

A perfectly competitive firm is said to be more efficient than a monopoly firm because

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Which market structure has many firms, no market power, a homogenous/identical product and is very easy to enter?

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The threat of competitors’ entering a market is very high in industries that perform a(n) _____ role and in industries where the primary product or service is _____.

更多留学生实用工具

希望你的学习变得更简单

When two or more large firms form a cartel, the price of products would_ and the output would_. This collusive behaviour more likely leads to a/an____ in the level of efficiency.

The threat of competitors’ entering a market is very high in industries that perform a(n) _ role and in industries where the primary product or service is _.