Homework Answers
Answer - Mutual Interdependence
Mutual interdependence is a characteristic of oligopoly, where various decisions like price, output or advertising depends on other firms also. The decision made by one firm invariably affects the other firm. These firms have a strategic behaviour and they have to think before making a move.
The number of competitors in oligopoly are less, so the firms are aware of how the rival would react to the change they make and they have to consider the opposition's move before making decision in order to gain market share or not lose the existing market share.
Therefore they are mutually interdependent.
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I only need help with question 5! Thank
you!
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microeconomics
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you!
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