An oligopolist may engage in short-run behavior that results in lower profits if
A) it leads to a Nash equilibrium.
B) it is a dominant strategy.
C) it is not involved in a repeated game.
D) it lends credibility to the firm's threats.

Question

Quizplus · Accepted Answer

An oligopolist may accept lower short-run profits if it helps establish credibility for its threats, which can be beneficial in the long run by influencing competitors' behavior.

An Oligopolist May Engage in Short-Run Behavior That Results in Lower