Under the Kinked Demand Curve Model, a Small Increase in Marginal

question 5

Multiple Choice

Under the kinked demand curve model, a small increase in marginal cost will lead to:

• A) an increase in output level and a decrease in price.
• B) a decrease in output level and an increase in price.
• C) a decrease in output level and no change in price.
• D) neither a change in output level nor a change in price.