The branch of economics that studies strategic decision making is called: interd

ID: 1167090 • Letter: T

Question

The branch of economics that studies strategic decision making is called:

interdependence theory.

game theory.

competitive theory.

noncompetitive theory.

strategic theory.

Six firms are currently producing and selling in a market. When two of the six firms exit the market, economists expect that the equilibrium price:

will be lower and the equilibrium quantity will be lower.

will be higher and the equilibrium quantity will be lower.

will be lower and the equilibrium quantity will be higher.

will be higher and the equilibrium quantity will be higher.

and the equilibrium quantity will not change.

interdependence theory.

game theory.

competitive theory.

noncompetitive theory.

strategic theory.

- game theory

In game theory individuals with different strategies makes the decision of choosing the best response out of set of all strategies.

- will be higher and equilibrium quantity will be lower.

When some firms exit, supply reduces. Decrease in supply leads to increase in prices and decrease in quantity in the market.

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