One of the implications of the kinked demand curve model is that even if a firm's costs change by a measurable amount,market price is unlikely to change.This helps explain the price rigidity observed in many oligopolistic markets.

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The kinked demand curve model predicts that price remains relatively stable despite changes in a firm's costs or other factors because competitors are likely to follow suit and maintain similar pricing strategies. This helps explain the price rigidity often observed in oligopolistic markets.

One of the Implications of the Kinked Demand Curve Model