Asked by
Shantel Dixon
on Oct 25, 2024
Verified
The oligopoly model that predicts that oligopoly prices will tend to be very rigid is the ________ model.
A) Cournot
B) Stackelberg
C) dominant firm
D) kinked demand
Kinked Demand
A demand curve that has a distinct bend or kink, typically resulting from an oligopolistic market structure where firms face different elasticities for price increases versus price decreases.
Oligopoly Model
A market structure characterized by a small number of large firms that dominate the market, leading to limited competition and potentially collusive behavior.
Price Rigidity
The situation in which prices of goods and services do not adjust immediately to changes in supply and demand, often due to agreements, regulations, or market conditions.
- Describe the concept of price stickiness in the context of oligopoly frameworks and its consequences.
Verified Answer
SC
Learning Objectives
- Describe the concept of price stickiness in the context of oligopoly frameworks and its consequences.