Suppose That a Firm Raises the Price of Its Product

question 121

Multiple Choice

Suppose that a firm raises the price of its product by 10 per cent.Although they have no requirement or agreement to do so,the other firms decide to raise their prices accordingly.This situation is best described as:

• A)price leadership.
• B)a cartel.
• C)monopolistic competition.
• D)a market with kinked demand.

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Definitions:

Jean Piaget

A Swiss psychologist known for his pioneering work in the study of child development and his theory of cognitive development.

Milestones

Significant points in development or events marking important stages or achievements in a process.

Dominant Gene

A gene that expresses its phenotype over another gene, the recessive gene, when they are both present in a pair of alleles.

Recessive Gene

A gene that produces its characteristic phenotype only when its allele is identical, otherwise being masked by the effects of a dominant gene.