Soon 34. The kinked demand curve modelof oligopoly assumes thatA. O Response to a price increase isless than the response to a pricedecreaseB. O Response to a price increase ismore than the response to a pricedecreaseC. O Elassticity of demand is constantregardless of whether priceincreases or decreasesD. O Elasticity of demand is perfectlyelastic if price increases andperfectly inelastic if pricedecreases

To find : What is kinked demand curve model of oligopoly.

Answered: The kinked demand curve model of…

Business

Economics

The kinked demand curve model of oligopoly assumes that

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter6: Elasticities

Section: Chapter Questions

Problem 13P: A movie production company faces a linear demand curve for its film, and it seeks to maximize total...

See similar textbooks

Related questions

Q: Which of the following groups of Ford Motor Company employees was most adversely affected after the…

Q: How does a typical worker decide how many hours to allocate to the labour market? Why did the labour…

A: A person who is being employed or carrying certain work for a specified payment and time is known as…

Q: GDP per Capita in 1990 International Dollars 1000 1500 1820 1995 Year $425 $420 $545 $675 $5,188…

A: GDP growth is generally referred to by the term "economic growth." The gross domestic product (GDP)…

Q: 17. Unemployment of labour means that

A: Unemployment refers to those who are employable and actively looking for work but are unable to find…

Q: According to the theory of comparative advantage, A. A country can gain from trade only if it can…

A: When an individual, an investor, or a corporation chooses one option over another, opportunity costs…

Q: Required information As indicated, some of the cash flows are expressed in future (then-current)…

A: Present worth refers to the value of a sum money that a person is going to receive in future in the…

Q: 07. Calculate Gross Value Added at FC from the followinfg data: (* in lakhs) Items () Sales tax 20…

Q: firms are making a positive economic profit, what happens in the market in the long run? Place the…

A: We need to put the given statements in the correct order. Positive economic profits means revenues…

Q: The figure depicts two industries, each facing an identical supply curve. Price 4 Which of the…

A: The equilibrium in any market, equilibrium price, and equilibrium quantity are determined by the…

Q: An economist says, "An effective price ceiling creates a shortage." In this context, the term…

A: Price controls are used by the governments when the market price is unfair to some section of the…

Q: A person wants to know how large his deposit of $10000 today will become at a compound annual…

A: Present deposit amount(P)=$10000 interest rate (r)=10% time (t) =5 years

Q: If the government decides to raise taxes to prevent inflation, this is an example of a) monetary…

A: Inflation can be combated by decreasing the aggregate demand.

Q: Table 1 Quantity Price Quantity Price Item 1990 1990 1991 1991 Coffee 10 8 $50 ---- Sugar 20 $1 15…

A: CPI in the year 1991 = [Cost of a basket of goods in 1991 / Cost of a basket of goods in a base year…

Q: How are wages affected in each case? New training programs provide students with the skills that are…

A: Wages are payments made to a worker for their service and usually remuneration is given on a hourly,…

Q: Refer to the above graph to answer this question. What could cause the movement from point A to…

A: Answer in given in step 2

Q: cure.com/coursés/1366104/quizzes/3252642/take Price and cost per unit $34 ATC 27 24.50 21 Demand MR…

A: In a market, a socially optimal output is when market is producing an output at which marginal cost…

Q: Please answer completely and clearly. , year יויויויויי in millions whatis the future worth of these…

A: We have given the cash flow in which yearly payment is made but the rate of interest is compounded…

Q: Complete the following analysis of investment alternatives and select the preferred alternative. The…

Q: The purchase price of a machine is $7500, its estimated salvage value is $3000, and its service life…

A: Depreciable amount = $7500 - $3000 = $4500 Sum of years' digits = 6+5+4+3+2+1=21

Q: . For the given CFD, the withdrawal has been arranged through a 5-year at $2,000 per year, starting…

A: The given cash flow series can be divided into two types of cash flow series, i) there is a uniform…

Q: What would be the value of X if the project's IRR is 12%? O A. $725 O B. $532 O C. $475 O D.$383

Q: SCENARIO 2. A firm's production function is given by Q = 4K + 8L and the input prices for capital…

A: The production function shows that K and L are perfect substitutes, meaning only one of them is…

Q: The function Q = 18 - P represent the market demand. The cost function of the monopolist is C = 2Q.…

A: Profit is the total revenue that is remained after all costs are paid by the producer. Marginal cost…

Q: Required information Problem 05.030 DEPENDENT MULTI-PART PROBLEM - ASSIGN ALL PARTS An electric…

A: i = 13% The analysis will be for 8 yrs.

Q: 1. Solving the Heckscher-Ohlin Model – Trade Between Two Countries. Your answer to this question…

A: Introduction In Heckscher - Ohlin theory, we know that if the countries has homothetic preferences…

Q: Dollars D D CQ5 b 0 F Multiple Choice Refer to the diagram. Equilibrium output is O O MR g hj Output…

Q: An economy produces turmeric for consumption, produces Cardamom to export, and imports sesame seeds…

A: a) Using 2015 as base year and calculating GDP for each year; Real GDP=Base year price×Current year…

Q: Three countries engage in the production of flax (an agricultural product). The market for flax in…

A: As the countries are engage in free trade such that the price of the output is common in all the…

Q: 11. Sophia pays $200 into a bank account at the end of each month. The annual interest paid on money…

A: Deposit per month = 200 Annual interest paid which is 3.1% compounded monthly

Q: A monopoly O A. faces a perfectly elastic demand curve. B. is able to raise the price it can charge…

A: A monopoly is a market structure when there is only one firm or producer and many buyers.

Q: Question 1 The table below shows the national income data of a country with a population of 40…

A: Gross domestic product (GDP): - GDP is the market value of all final goods and services produced in…

Q: 5. Priyanka has an income of £90,000 and is a von Neumann-Morgenstern expected utility maximiser…

A: Von Neumann-Morgenstern utility function is an extension of consumer utility theory that…

Q: country has a rate of growth (g) of 1.00%, a debt-to-income ratio of 92% and a primary deficit of…

A: Here we calculate the following terms by using the given information , so the calculation of the…

Q: To pay for a farm, Axle has to make equal payments of P135,900.00 at the beginning of each six…

A: Interest rate is the sum charged over the initial deposit by the bank from the borrower. As far as…

Q: 8. The Borda Count is a common way of making a choice among more than two alter- natives. As defined…

A: The Borda Count is a voting method where each alternative is assigned points based on its rank from…

Q: What would happen to the equilibrium price and quantity of coffee if the wages of coffee-bean…

A: Given: The wages of pickers fell The price of tea fell

Q: Total liabilities / Total assets Current liabilities - Current assets Current liabilities / Current…

A: Assets are anything, like machinery which has economic value for the firm/business. It can also be…

Q: Which of the following is not one of the seven major segments of the retail industry? * O…

A: Retail industry includes sale of goods and services by a company directly to consumers.

Question

Soon

34. The kinked demand curve model
of oligopoly assumes that
A. O Response to a price increase is
less than the response to a price
decrease
B. O Response to a price increase is
more than the response to a price
decrease
C. O Elassticity of demand is constant
regardless of whether price
increases or decreases
D. O Elasticity of demand is perfectly
elastic if price increases and
perfectly inelastic if price
decreases

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

explains it correctlt
Assuming you are the managing director of a firm that produces three goods: A, Band C. The price elasticity of demand for A is 1.2, for B it is 1.00 and for C it is 0.75.It is known that he firm is experiencing serious cash flow problems and you have toincrease total revenue as soon as possible. If you were in a position to set the pricesfor these goods, what would be your pricing strategy for each product
Suppose the local electrical utility, a legal monopoly based on economies of scale, was split into four films of equal size, with the idea that eliminating the monopoly would promote competitive pricing of electricity. What do you anticipate would happen to prices?
MN 00 16 LO LL %24 Submit All Question 37 of 60 > When a firm uses third-degree price discrimination, the group of consumers with demand would face the highest prices. O high elasticity of O perfectly elastic O unitary elastic O low elasticity of 10:10 PM 75 F ENG 12/12/2021 dp OL4 114 f12 delete home SUI 6J pue 81 144 f4 num + backspace lock 6 6. 7. 4. home D. R. enter 4. pause T shift N.
. When Chinese automakers began exporting cars, rather thanfocusing on developed nations in the West, they shippedautos to emerging markets in countries such as Algeria, Russia,Chile, and South Africa. In these markets, even used vehiclesfrom multinational manufacturers are relatively scarce—andrelatively expensive. The Chinese automakers, who prioritizelow cost rather than design or even safety, applied a penetration-pricing strategy. A woman in Santiago, Chile, who boughta new Chery S21 explained, “The price factor is fairly decisive.I paid $5,500 new and full. Toyota with similar features costsaround $12,000.” Why do you think Chinese automakerschose that pricing strategy? Do you think it was successful?As Chinese regulators pressure these manufacturers to maketheir cars safer, do you think they will be able to keep theirprices low compared with those of the international automakers? Why or why not?26
Only typed answer
.
Suppose that Volkswagen hires a popular singer to adver-tise its compact automobiles. The campaign is very success-ful, and the company increases its share of the compact-car market substantially. What is Ford likely to do?
QUESTION 34 Monopolist competition and oligopoly are alike in that Oa the number of businesses is approximately the same in each b. strong mutual interdependence exists among businesses in oach Oc barriers to entry are significant to both d.non-pnce competition is common to both QUESTION 35 If nominal GDP rises: O1.real GDP must also rise O2.real GDP must fall 3. the price leel has fallen 04. the price level has risen 5.real GDP may either rise or fall
enter roctor "se urce n When negative externalities are present in a market 3 O private costs will be greater than social costs. O social costs will be greater than private costs. O only government regulation will solve the problem. O the market will not be able to reach any equilibrium. Question 3 In a monopolistically competitive industry, firms set price O equal to marginal cost since each firm is a price taker. O below marginal cost since each firm is a price taker. O above marginal cost since each firm is a price setter. O always a fraction of marginal cost since each firm is a price setter. C $ O 4 % BABAA 5 M Oll 6 & O 7 8 O 9 2 pts ✓ 0
MN 00 工 25 Price %24 For the monopolistically competitive firm in the following figure, the profit-maximizing price is and the quantity is MC ATC 32 20 Demand MR Quantity O $20; 25 O $16; 25 O $32; 25 O $20; 40 10:12 PM 75°F ENG earch 12/12/2021 f12 Ins prt sc delete home 61 pua f5 dn 6d f4 84 114 144 米 backspace lock 4. 5. R. home enter 4. K. pause ↑ shift end 2. C. alt ctrl
“A direct inducement that offers an extra value or incentive for the product to thesales force, distributors, or the ultimate consumer with the primary objective of creatingan immediate sale. As an intellectual and dynamic marketer of Singer BangladeshLimited, explain with appropriate examples, what promotional tools you will throw topromote your Television in the rural areas of Bangladesh and how?