Because of mutual interdependence,oligopolists must:
A)co-operate with their rivals
B)operate as rivals
C)ignore the actions of their competitors
D)take into account the potential reactions of competitors to actions they may take
E)act as if they were perfectly competitive

Question

Quizplus · Accepted Answer

Oligopolists must take into account the potential reactions of competitors to actions they may take. This is because oligopolies are characterized by mutual interdependence among firms, which means that the actions of one firm will impact the other firms in the industry. Therefore, firms in an oligopoly must consider the potential reactions of their competitors when making strategic decisions.

Because of Mutual Interdependence,oligopolists Must