Game Theory Is

question 38

Multiple Choice

Game theory is

• A) The study of price-fixing and collusion.
• B) The study of how decisions are made when interdependence exists between firms.
• C) An explanation of how oligopolists become monopolists.
• D) Practiced by perfectly competitive firms.

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Definitions:

Mark-Up Percentage

The percentage added to the cost price of goods to cover overhead and profit, determining the selling price.

Material Charge

A fee or cost applied for the materials used in the manufacturing or production of goods.

Material Cost

The cost of raw materials and components used to create a product.

Price Skimming

A pricing strategy where a company charges the highest initial price that customers will pay and then lowers it over time.