A market structure in which a few large firms dominate is called an?

• A. Monopoly
• B. Oligopoly
• C. Perfect Competition
• D. Monopsony

Answer: (B)

An oligopoly describes a market structure where a few large firms dominate the industry. Because only a small number of players hold most of the market share, each firm must consider how the others will react when setting prices or output, so decisions are interdependent. Barriers to entry keep new firms from easily entering, helping the leading firms sustain their position. Pricing can be stable or coordinated through competition or tacit understanding, rather than simply determined by many independent sellers.

This differs from a monopoly (one seller), perfect competition (many sellers with identical products and price-taking behavior), and a monopsony (one buyer). So the described market fits the term oligopoly.