cartel  an organization of independent firms whose purpose is to control and limit production and maintain or increase prices and profits
cost-plus pricing or markup pricing  a pricing policy where­by a firm computes its average cost of producing a product and then sets the price at some percentage above this cost
dominant strategy  a strategy that produces better results no matter what strategy the opposing firm follows
facilitating practices  actions by oligopolistic firms that can contribute to cooperation and collusion even though the firms do not formally agree to cooperate
game theory  a description of oligopolistic behavior as a series of strategic moves and countermoves
most-favored customer (MFC)   a customer who receives a guarantee of the lowest price and all product features for a certain period of time
sequential game  a situation in which one firm moves first and then the other firm is able to choose a strategy based on the first firm’s choices
strategic behavior  behavior that occurs when what is best for B depends on what A chooses and what A chooses depends on what B is most likely to do