Mutual interdependence means that each firm in an oligopoly


Mutual interdependence means that each oligopolistic firm: O faces a perfectly elastic demand for its product. O must consider the reactions of its rivals when it determines its price policy. O produces a product identical to those of its rivals. O produces a product similar but not identical to the products of its rivals.

Answer

Ans: (B) must consider the reactions of its rivals when it determines its price policy.

Oligopolistic firms are mutually interdependent to each- other which means that one firm must consider & anticipate the possible reaction of its rival firms while determining its own price policy.

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