Interdependence is an important consideration when modelling the behaviour of
A) consumers.
B) strangers.
C) perfectly competitive firms.
D) monopolies.
E) oligopolies.

Question

Quizplus · Accepted Answer

Interdependence is most important when modelling the behaviour of oligopolies, as these are markets with just a few dominant firms that are highly dependent on each other's strategies and actions. In a perfectly competitive market, firms are not interdependent as they all have negligible market power and cannot influence prices. Monopolies are not interdependent as they have no competitors to worry about. While consumers and strangers can be interdependent in certain situations, it is not the primary consideration when modelling their behaviour.

Interdependence Is an Important Consideration When Modelling the Behaviour of