The branch of economics that studies oligopoly decision making is called ________ theory.

Question

Quizplus · Accepted Answer

Game theory is the branch of economics that studies how people make strategic decisions when they interact with each other. It is used to analyze the behavior of firms in oligopoly markets, where there are only a few dominant firms that interact with each other strategically. Game theory helps to explain why firms might collude to fix prices or engage in aggressive pricing strategies to gain market share. Therefore, the correct answer is B) game theory.

The Branch of Economics That Studies Oligopoly Decision Making Is