The interdependence between firms in an oligopoly leads to _____.
A)trade wars
B)lowered supply
C)imitative behavior
D)higher demand

Question

Quizplus · Accepted Answer

A critical competitive feature of oligopolistic industries is interdependence of the major players.By cutting prices,one firm in an oligopoly can take market share away from its competitors,forcing them to respond with similar price cuts to retain their market share.Thus,the interdependence between firms in an oligopoly leads to imitative behavior;rivals often quickly imitate what a firm does in an oligopoly.

The Interdependence Between Firms in an Oligopoly Leads to _____