An oligopolistic price leader increases the price of its product.If all other firms follow the leader's example,the price leader will:

Question

Quizplus · Accepted Answer

In an oligopoly, firms often follow the pricing strategy of the market leader. If the market leader increases the price of its product and all other firms follow the leader, the leader will maintain its new price since it is the trendsetter and the other firms follow its lead. Therefore, the most likely outcome is that the price leader will maintain its new price.

An Oligopolistic Price Leader Increases the Price of Its Product