The table below shows the payoff (profit) matrix of Firm A and Firm B indicating the profit outcome that corresponds to each firm's pricing strategy (where $500 and $200 are the pricing strategies of two firms).Table 12.2

-Certain actions by oligopolistic firms can lead to collusion even when they formally do not agree to cooperate.

Question

The table below shows the payoff (profit) matrix of Firm A and Firm B indicating the profit outcome that corresponds to each firm's pricing strategy (where $500 and $200 are the pricing strategies of two firms).Table 12.2
 
-Certain actions by oligopolistic firms can lead to collusion even when they formally do not agree to cooperate.

Quizplus · Accepted Answer

Collusion can occur through various informal means such as tacit understanding, signaling, and repeated interactions.

The Table Below Shows the Payoff (Profit) Matrix of Firm