Which of the following best illustrates the mutual interdependence among firms in the airline industry?
a. The considerable efforts made by the various competitors to coordinate fare increases.
b. The unwillingness of individual firms to match increased amenities offered by other firms.
c. The substantial profits airlines have earned over the past several years.
d. The virtual absence of control over costs by any of the firms operating in the industry.
The airline industry refers to a business that focuses on dealing with the transportation services which is provided to the people and freight. Airlines aim to use the aircraft to focus on supplying the services, etc.
Answer and Explanation:
Mutual interdependence refers to a term that denotes a group of oligopolies which are benefitted from each other either through geographical locations, market share, allocation of price or product differentiation, etc. Thus, according to the statements given above, the option which best illustrates mutual interdependence among the firms within the airline industry is the considerable effort made by various competitors in order to coordinate fare increases. (Correct answer: a)
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from 6th-8th Grade Math: Practice & ReviewChapter 48 / Lesson 5