Mutual interdependence does not refer to which of the following?
A) A firm must consider how rival firms would respond to its own decisions and actions.
B) A firm's profit depends not just on its own decisions and actions but also on those of other firms.
C) Entry by new firms into the industry tends to shrink existing firms' profits.
D) Competing firms respond to one another's pricing, production, or marketing decisions.

Question

Quizplus · Accepted Answer

Option C is not a correct definition of mutual interdependence. It is true that entry by new firms into the industry may reduce profits for existing firms, but it does not directly relate to the mutual interdependence of firms' decisions and actions. Options A, B, and D are all examples of how firms' decisions and actions are interdependent and affect one another in a mutually dependent way.

Mutual Interdependence Does Not Refer to Which of the Following