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Business

Economics

How is a cooperation achieved by firms? Please discuss.

Microeconomics

13th Edition

ISBN:9781337617406

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter11: Monopolistic Competition, Oligopoly, And Game Theory

Section: Chapter Questions

Problem 9QP

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The long-term planning in the oligopoly market should consider the reactions of other participants. In other words, any decision taken in an oligopoly market should have a cooperative outcome.

Cooperation in an oligopoly means that the competing businesses collectively make the decision to cooperate which makes them stand in a better position. It increases the profitability of all firms involved.

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How is a cooperation achieved by firms? Please discuss.

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