Which market structure is characterized by a few sellers controlling the majority of a product supply?

The correct answer is oligopoly. This market structure is defined by the presence of a small number of firms that dominate the market, leading to limited competition among them. In an oligopoly, these few sellers control a significant portion of the market supply, which can result in higher prices and less choice for consumers compared to a more competitive market structure.

Additionally, the behavior of firms in an oligopoly is often interdependent, meaning that the actions of one firm (like changing prices or introducing a new product) will be closely monitored by the others, as they are aware that their decisions can significantly impact the market dynamics and their profitability. This characteristic leads to strategic planning and sometimes even collusion among companies to maintain market power.

In contrast, a monopoly is characterized by a single seller dominating the entire market, whereas monopolistic competition involves many sellers with differentiated products. Pure competition has many sellers offering identical products, leading to a high level of competition with no single seller controlling the market supply.