The sharp drop in revenue that occurs when an individual seller in an oligopoly raises its price above the prevailing level indicates sellers in an oligopoly face a(n):

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The sharp drop in revenue when a seller in an oligopoly raises prices above the prevailing level is indicative of a kinked demand curve. This concept suggests that if a firm raises its prices, others will not follow, leading to a significant loss in market share and revenue for the firm that increased its prices. Conversely, if a firm lowers its prices, others are likely to follow to maintain their market share, leading to a situation where price decreases do not significantly increase one firm's market share or revenue. This creates a situation where prices tend to be rigid.

The Sharp Drop in Revenue That Occurs When an Individual