Mutual forbearance is the situation in which a responding firm takes the same strategic action as the attacking firm,thus signaling a commitment to defend the status quo without escalating rivalry.

Question

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Mutual forbearance refers to firms recognizing their mutual interdependence and choosing not to engage in aggressive competition, often by avoiding actions that could provoke retaliation, rather than taking the same strategic actions.

Mutual Forbearance Is the Situation in Which a Responding Firm