Use the Following Scenario to Answer the Following Questions

question 91

Multiple Choice

Use the following scenario to answer the following questions:
Kit-N-Sit and Kittysitters are two cat-sitting services in Kent,Ohio.There are no other cat-sitting services,so the market is considered to be a duopoly.
-According to the kinked demand curve theory,if Kit-N-Sit cuts prices,Kittysitters will

• A) do nothing and leave prices unchanged.
• B) sue Kit-N-Sit for monetary damages in court.
• C) respond aggressively by increasing prices drastically.
• D) respond aggressively by increasing prices moderately.
• E) respond aggressively by cutting prices.

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Definitions:

Imperialism

Is the economic domination of one country by another.

One Country

A principle often mentioned in discussions about the sovereignty and political structure, especially in contexts where there's a focus on maintaining national unity in areas with complex histories.

International Trade

The exchange of goods and services between countries, which plays an essential role in the global economy.

Foreign Investment

Capital investment made by individuals or entities in one country into business interests or assets in another country, typically in the form of direct investments or portfolio investments.