When oligopolists compete in quantities, they are in
A)collusion.
B)perfect competition.
C)cooperation.
D)Cournot competition.
E)Bertrand competition.

Question

Quizplus · Accepted Answer

When oligopolists compete in quantities, they are engaged in Cournot competition. This occurs when firms compete by choosing quantities simultaneously based on their expectations of their rival's actions. Each firm assumes their competitors' output to be constant and decides how much to produce considering that as given. This strategic behavior leads to an equilibrium where each firm is producing the quantity of output that maximizes its profit given its competitors' quantities.

When Oligopolists Compete in Quantities, They Are in