Faced with a Kinked Demand Curve,what Action Will an Oligopolist

question 75

Multiple Choice

Faced with a kinked demand curve,what action will an oligopolist take if the costs of production increase?

• A)Increase the price
• B)Decrease the price,but only if the demand is elastic.
• C)Decrease the price,but only if the demand is inelastic.
• D)Decrease the price but only if it is a big increase in costs.
• E)Nothing,unless it is a very big increase in costs.

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