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6 February, 06:27

In an oligopoly market Group of answer choices individual firms pay no attention to the behavior of other firms. advertising of one firm has no effect on all other firms. one firm's pricing decision affects all the other firms. the pricing decisions of all other firms have no effect on an individual firm.

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  1. 6 February, 10:04
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    Option C

    One firm's pricing decision affects all the other firms

    Explanation:

    An oligopoly is a market structure where the production of goods and services is shared by only a small number of large firms. A good example is the automobile industry in America

    In an oligopoly, the leading firms are actually producing to a certain extent, substitute goods, since they are all within the same industry.

    If one of the large firms sets a price, this will affect the pricing that the other large firms will adopt because of the substitutive nature of their goods and services. Businesses operating within an oligopoly want to keep their prices similar. Price reductions by a company will cause the other companies to reduce their prices also, to ensure they are still in the competition.

    Hence, a firm's pricing decision affects all the other firms
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