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From course:

Economics A Level

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Question:

What is the Outcome from the Kinked Demand Curve -Is it seen in all Oligopolistic Markets?

Author: go kys



Answer:

-Result of the Kinked Demand Curve shows that Firms have no Interest to Change their Prices. Both will end up being a Loss for them -This isn’t seen in All Markets though. The Assumptions may be not always Best Suited for the Oligopoly, and this, its hard to Predict the Behaviour -Furthermore, Price Drops and Increases can be due to Non-Price Factors (Quality)


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go kys
go kys