A situation in which oligopolists interacting with one another each choose their best strategy given the strategies that all the other oligopolists have chosen is known as a

Question

Quizplus · Accepted Answer

The situation described in the question is a Nash equilibrium, where each oligopolist's strategy choice is based on the choices of the others. This concept was introduced by John Nash, an American mathematician and Nobel Prize winner, and it has become a foundational concept in game theory. The other options (B, C, and D) do not accurately describe the situation in the question. A dominant strategy is one that is best regardless of what the other players do, but this is not the case in an oligopoly. A cartel involves firms colluding to restrict output and raise prices, which is different from the situation described in the question. Collusion solution is not a widely recognized term in economics or game theory.

A Situation in Which Oligopolists Interacting with One Another Each