Mutually interdependent decision making among firms is a key characteristic of
A) monopolistic competition.
B) an oligopoly.
C) perfect competition.
D) a monopoly.

Question

Quizplus · Accepted Answer

Oligopolies are characterized by a small number of firms whose decisions regarding prices and output are interdependent. Each firm must consider the potential reactions of its competitors when making its own decisions, unlike in monopolistic competition, perfect competition, or a monopoly where this level of interdependence is not present.

Mutually Interdependent Decision Making Among Firms Is a Key Characteristic