What form of market is found in an imperfect competition where there are few buyers and many sellers

1. Analyze the question The question asks for the market structure in imperfect competition where there are few buyers and many sellers. The key is to focus on the buyer side, since only a few buyers exist.

2. Explain the concept Market structures are named by the number of sellers or buyers:

| Term | Meaning | |---|---| | Monopoly | One seller | | Oligopoly | Few sellers | | Duopoly | Two sellers | | Monopsony | One buyer | | Oligopsony | Few buyers | | Duopsony | Two buyers |

The suffix -poly refers to sellers, and -psony refers to buyers.

3. Step-by-step solution

• Few buyers: this points to an "-opsony" market, so the options for sellers (monopoly, oligopoly, duopoly) are ruled out.
• A. Monopoly: one seller, so it is wrong.
• B. Oligopoly: few sellers, but the question says many sellers, so it is wrong.
• C. Duopoly: two sellers, so it is wrong.
• D. Oligopsony: few buyers, which matches the question.

A real-life Nigerian example is the cocoa or palm kernel market, where many small farmers sell to just a few big buying companies or agents. That is an oligopsony.

4. Answer The correct option is D. oligopsony.

5. Exam tip Remember: "poly" = sellers, "psony" = buyers. The "s" in "psony" can remind you of "shoppers" (buyers). Then just add the number prefix: mono = one, duo = two, oligo = few.