Oligopoly
A market with so few sellers that each must anticipate how rivals will react to its price and output. Outcomes range from nearly competitive to nearly monopolistic, depending on whether they collude.
Where you will meet it
Oligopoly appears in 2 learning outcomes on the CFA syllabus. A few of them:
- Contrast monopoly, perfect competition and the market structures in between
“Oligopoly is the awkward case: few enough sellers that each must anticipate the others, so outcomes range from nearly competitive to nearly monopolistic depending on whether firms collude.”
- Explain how firms set price and quantity in oligopoly and monopolistic competition
“Firms under monopolistic competition and oligopoly face downward-sloping demand, so each maximises profit by producing where marginal revenue equals marginal cost and then charging the price the demand curve allows at that output.”
Practise it
Practise oligopoly until it is automatic: questions that explain every wrong option.
Take the free diagnostic →