A defining characteristic of oligopoly is that all firms in an industry typically consider the reactions of competitors when they formulate strategy.

Question

Quizplus · Accepted Answer

In an oligopoly, a small number of firms dominate the market, and because of this, each firm must consider the potential reactions of its competitors when making strategic decisions, such as pricing, output, and advertising. This interdependence is a defining characteristic of oligopolistic markets.

A Defining Characteristic of Oligopoly Is That All Firms in an Industry