Question

Any actions a firm takes that have the effect of reducing the level of rivalry in an industry that also do not require firms in an industry to directly communicate or negotiate with each other can be thought of as

A) tacit cooperation.
B) tacit collusion.
C) explicit collusion.
D) competitive parity.

Answer 1

Tacit cooperation refers to actions taken by firms to reduce competition and coordinate their actions without direct communication or negotiations. It involves strategies such as price leadership and mirroring competitors' actions. Option d.

Step-by-step explanation:

Any actions a firm takes that have the effect of reducing the level of rivalry in an industry without direct communication or negotiations with other firms can be referred to as tacit cooperation. This term refers to the unspoken understanding between firms to reduce competition and coordinate their actions, even without formal agreements. It involves strategies such as price leadership, mirroring competitors' actions, or adopting similar marketing tactics.