The Kinked Demand Curve Pricing Model Is Based on the Assumption

question 16

Multiple Choice

The kinked demand curve pricing model is based on the assumption that:

• A) a firm's competitors will match both its price increases and price decreases.
• B) one firm in the industry sets price for all other firms.
• C) a firm's competitors will match a price fall but not a price increase.
• D) price in the market is inflexible and unlikely to change.

---

Definitions:

Demos

The common people of a democracy, who hold the power to make decisions through voting.

Spirit of '76

An iconic symbol of American patriotism, representing the fervor and zeal for independence and freedom during the Revolutionary War era.

Amendments

Formal changes or additions made to the U.S. Constitution or other legal documents, requiring a specific legislative or ratification process.