Why are the firms said to be interdependent in an oligopoly market? Explain.
Explain why firms are mutually interdependent in an oligopoly market
Explain the implications of the following:
Interdependence between firms in oligopoly.
Explain the feature 'interdependence of firms' in an oligopoly market.
Interdependence between firms:- In an oligopoly market, the price and level of an output of one firm impact the price and level of an output of rival firms. Keeping this impact in mind, a firm decides the price and output in accordance with prevailing market conditions. Hence, a high degree of interdependence exists among competing firms, especially with regard to price and quantity of output