Question Help market for electronic readers consists of relatively tew frms, inc

Question

Question Help market for electronic readers consists of relatively tew frms, including Amazon, Sony, and Plastic Logic. In an interview, Water Mossberg of the Wl Street Jourmal asked Rich Avchulieta, CEO of Plastic Logic, what price compary would be charging for a new electronic reader that it was developing, aimed at business users. Archuleta declined to give a Logic is competing in an oligopolisšic industry, so shouidn't the firm, not the market, be setting the price? specific price, saying instead, The market sets pricing. We don't set pricing But Plassc Source: "Plastic Logic Shows New E-Book Reader," Wl Street Journal, May 27, 2009 Explain why Archuleta made the statement he made Archuleta likely meant that O A although firms in an oigopoly are typically free to select their price, his 8imm is unable to pick ts price because it is bound by a cartel agreement ? ?· although firrns in an olgopoly select their price, competitve sorces, such as compeoton from stetute goods detemre which pnoe man tes prot O C. athough fiems in an oligopoly select their price, competitive forces, such as government regulations, determine which prices are legat O D. although some firms in an oligopoly select their price,is fim is in an olgopoly where fims do not set their own grice ? E. although firms nanoligopoly select heir price, dempestive force6, such as tod coss, dotermine which price mamrunes profit.

Explanation / Answer

Answer

Option (E) is the correct option

i.e

although the firms in oligopoly select their price ,Competitive forces,

determines which price maximizes profit.

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