Answer to Question #149907 in Microeconomics for Anis

Question

Drive cinema is oligopoly? What the characteristic for drive cinema ?

Answer 1

Drive cinemas are oligopoly. They are characterized by few sellers and hence stiff competition; they are huge in relation to the markets they serve and hence any changes in the price or marketing strategy affects rival drive cinemas in a great extent hence interdependence; they enjoy economies of scale hence creating a barrier for new entrants who lack enough knowledge about the market and enough capital. Drive cinemas are also characterized by prevalent advertising on a national scale.