Oligopoly: Supply Analysis and Price Leadership

In an oligopolistic industry, a firm is _most likely_ to be a price:

Correct. Because this firm's brand enables it to dominate the market, it can set a price with the expectation that rivals will copy it.

Incorrect. A firm can best exploit its cost advantage by acting as a price leader.

Incorrect. Setting a high price would enable rivals to undercut the firm's price to exploit its cost disadvantages.

follower if it has a cost advantage over its rivals.

leader if it requires a high price to overcome its cost disadvantage.

leader if it enjoys a significant advantage due to brand name recognition.