What assumptions about a rival’s response to price changes underlie the kinked-demand curve for oligopolists? Why is there a gap in the oligopolist’s marginal-revenue curve? How does the kinked-demand curve explain price rigidity in oligopoly? What are the shortcomings of the kinked-demand model?
What assumptions about a rival’s response to price changes underlie the kinked-demand curve for oligopolists? Why is there a gap in the oligopolist’s marginal-revenue curve? How does the kinked-demand curve explain price rigidity in oligopoly? What are the shortcomings of the kinked-demand model?
Chapter26: Monopolistic Competition And Oligopoly
Section: Chapter Questions
Problem 11E
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What assumptions about a rival’s response to price changes underlie the kinked-
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ISBN:
9781337617383
Author:
Roger A. Arnold
Publisher:
Cengage Learning