If Rival Oligopolists Completely Ignore Mitchell's Tool Company's Price Changes,then

question 1

Multiple Choice

If rival oligopolists completely ignore Mitchell's Tool Company's price changes,then Mitchell's Tool Company's

• A)Demand curve will not have a kink.
• B)Most profitable strategy will be to raise its price.
• C)Demand curve will be less elastic than if rivals matched price changes.
• D)Demand and marginal revenue curves will be the same.

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Definitions:

Utility Function

A representation in economics that maps a set of goods and services into a level of utility or satisfaction.

Leisure

Time available for ease and relaxation where no work is done.

Consumption Goods

Goods that are intended and consumed by individuals or households to satisfy their immediate wants and needs.

Perfect Complements

Goods that are often used together in fixed proportions, where the utility of one item increases with the usage of the other.