Which pair of Australian firms operates in an oligopoly?

Question

BlackTom AI · Accepted Answer

An oligopoly is a market structure in which a small number of large firms dominate supply, leading to mutual interdependence, significant market concentration, barriers to entry, and strategic behavior (price and non-price competition).

1. Relevant knowledge points and concepts
- Oligopoly: few sellers control a large market share; firms consider rivals’ reactions when setting prices or strategies. A duopoly is an extreme form with two dominant firms. Indicators include high combined market share, strong brand presence, large scale economies, and barriers to entry (distribution networks, capital requirements, supplier relationships).

2. Step-by-step reasoning
- Identify pairs that operate in the same market and have high concentration.
- Evaluate market structure characteristics for each pair: number of competitors in that sector, relative market shares, and evidence of interdependence.

3. Intermediate evaluation steps
- Coles and Woolworths: Both are national supermarket chains in Australia occupying the top two positions in grocery retail. Together they account for the majority of supermarket sales (often cited as roughly 60–80% combined depending on measure), exhibit price-matching, frequent promotional competitive responses, and large distribution/logistics scale—hallmarks of an oligopoly/duopoly.
- Blackmores and Swisse Vitamins: They are prominent supplement brands but compete in a fragmented health-supplement market with many players (pharmacies, private labels, imports), so the market is not dominated solely by a few firms.
- Cotton On and Supre: Both are apparel retailers, but the fashion retail sector has many competitors (national and international brands), so it is not an oligopoly.
- Boost Juice and Aesop: These are in different product categories (juice retail vs. cosmetics); they do not form an industry oligopoly.

4. Why the correct answer is correct
- Coles and Woolworths meet oligopoly criteria: concentrated market share, mutual strategic responses (pricing/promotions/loyalty programs), and significant barriers for new national supermarket chains.

5. Why other options are incorrect
- Boost Juice & Aesop: different industries.
- Blackmores & Swisse: competitive but within a broader fragmented market.
- Cotton On & Supre: many competitors in apparel reduce concentration below oligopoly level.

6. Conclusion
Coles and Woolworths Supermarket is the correct choice, matching the provided answer.

Which pair of Australian firms operates in an oligopoly?单项选择题

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