Which of the following refers to a situation where downward price moves by one competitor force "follower moves" by other competitors in order to minimize lost profits?
A)a technology trap
B)competitive benchmarking
C)the prisoner's dilemma
D)a monopoly market
E)a free market situation

Question

Quizplus · Accepted Answer

The situation described in which competitors follow each other in lowering prices is known as the prisoner's dilemma. This is a classic game theory scenario in which each participant is motivated to act in their own best interest, but the outcome for all is worse than if they had cooperated with each other. In this case, the competitors are all trying to avoid losing profits, but their actions lead to an overall decrease in industry profits.

Which of the Following Refers to a Situation Where Downward