Game theory can be used to demonstrate that oligopolists:

A) rarely consider the potential reactions of rivals.
B) experience economies of scale.
C) can increase their profits through collusion.
D) may be either homogeneous or differentiated.

Game Theory

The study of how people behave in strategic situations in which individuals must take into account not only their own possible actions but also the possible reactions of others. Originally developed to analyze the best ways to play games like poker and chess.

Economies Of Scale

Cost advantages that enterprises obtain due to their scale of operation, typically associated with efficiencies in production as output increases.

Collusion

An agreement between firms in a market to limit competition and manipulate prices or market conditions.