Question: KEY QUESTION Explain the general meaning of the following profit payoff matrix for oligopolists C and D. All profit figures are in thousands. a. Use

KEY QUESTION Explain the general meaning of the following profit payoff matrix for oligopolists C and D. All profit figures are in thousands.

a. Use the payoff matrix to explain the mutual interdependence that characterizes oligopolistic industries.

b. Assuming no collusion between C and D, what is the likely pricing outcome?

c. In view of your answer to 8 b , explain why price collusion is mutually profitable. Why might there be a temptation to cheat on the collusive agreement?

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