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Oligopoly • Kinked demand curve theory – assumptions of the model

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OligopolyOligopoly

• Kinked demand curve theory

– assumptions of the model

• Kinked demand curve theory

– assumptions of the model

Kinked demand for a firm under oligopolyKinked demand for a firm under oligopoly£

Current priceand quantity

give one pointon demand curve

Kinked demand for a firm under oligopolyKinked demand for a firm under oligopoly

OligopolyOligopoly

• Kinked demand curve theory

– assumptions of the model

– stable prices

• Kinked demand curve theory

– assumptions of the model

– stable prices

MC2

MC1

bD AR

Stable price under conditions of a kinked demand curveStable price under conditions of a kinked demand curve

OligopolyOligopoly

• Kinked demand curve theory

– assumptions of the model

– stable prices

– limitations of the model

• Kinked demand curve theory

– assumptions of the model

– stable prices

– limitations of the model

OligopolyOligopoly

• Kinked demand curve theory

– assumptions of the model

– stable prices

– limitations of the model

• Oligopoly and the public interest

• Kinked demand curve theory

– assumptions of the model

– stable prices

– limitations of the model

• Oligopoly and the public interest

OligopolyOligopoly

• Kinked demand curve theory

– assumptions of the model

– stable prices

– limitations of the model

• Oligopoly and the public interest

– advantages

• Kinked demand curve theory

– assumptions of the model

– stable prices

– limitations of the model

• Oligopoly and the public interest

– advantages

OligopolyOligopoly

• Kinked demand curve theory

– assumptions of the model

– stable prices

– limitations of the model

• Kinked demand curve theory

– assumptions of the model

– stable prices

– limitations of the model

OligopolyOligopoly

• Kinked demand curve theory

– assumptions of the model

– stable prices

– limitations of the model

• difficulties in drawing general conclusions

• Kinked demand curve theory

– assumptions of the model

– stable prices

– limitations of the model

• difficulties in drawing general conclusions

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