Assuming That Oligopolists Do Not Have the Opportunity to Collude

question 4

Multiple Choice

Assuming that oligopolists do not have the opportunity to collude, once they have reached the Nash equilibrium, it:

• A) is always in their best interest to supply more to the market
• B) is always in their best interest to leave supply unchanged
• C) is always in their best interest to supply less to the market
• D) may be in their best interest to do any of the above, depending on market conditions

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Definitions:

Production Stable

A situation in manufacturing where the production process is consistent, reliable, and capable of meeting expected demand without significant fluctuations.

Forward Buying

The practice of purchasing stock in larger quantities than needed immediately to take advantage of lower prices or anticipated price increases.

Peak Period

The time when demand for goods or services is at its highest, often leading to increased prices and competition.

Time Flexibility

The ability to adapt to changes in scheduling or deadlines.