Monopolies & oligopolies

You have been contracted by an economic consulting firm to determine the economic structure and possible future actions of OPEC, the Organization of Petroleum Exporting Countries.

1. Explain the difference between a monopoly and an oligopoly, and a cartel.

2. Provide an example of a monopoly, an oligopoly, and a cartel.

3. Discuss the welfare effects of monopolies and oligopolies.

4. Explain the game theory.

5. Using your own words, discuss the economic purpose of OPEC.

6. What has happened to oil prices over the past five years?

7. Based on your answers to the above questions, synthesize the information you have gathered and tell the economic consulting firm which actions you think OPEC will take over the next year.