Question

question 10 (2 points)
which of the following scenarios can be analyzed using game theory?
○ a) a firms internal decision - making process.
○ b) price - setting behavior in an oligopoly.
○ c) natural monopolies.

Explanation:

Game theory analyzes strategic interactions among rational decision - makers. In an oligopoly, firms are interdependent (their decisions affect and are affected by other firms). Price - setting in an oligopoly involves strategic interaction (e.g., if Firm A lowers price, Firm B may respond). A firm's internal decision - making (no interaction with other external rational agents in the context of the question) and natural monopolies (single - seller with no strategic interaction in the relevant sense here) do not fit the game - theoretic analysis as well as oligopoly price - setting.

Answer:

B. Price - setting behavior in an oligopoly.