Each Oligopolistic Firm Recognizes That It Must Take into Account

question 49

Multiple Choice

Each oligopolistic firm recognizes that it must take into account the behavior of its competitors when it makes pricing decisions. This recognition is called

• A) monopolistic behavior.
• B) profit-maximization behavior.
• C) mutual interdependence.
• D) mutual dependence.

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Definitions:

Disposable Income

Refers to the amount of money that households have available for spending and saving after income taxes have been accounted for.

APS (Average Propensity to Save)

The fraction of total income that is saved by the average household.

Disposable Income

The amount of money an individual or household has to spend or save after income taxes have been deducted.

Saving

The act of setting aside money for future use rather than spending it immediately.