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Narrbegin Exhibit 9.3 Kinked Demand Curves

Question 113

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Narrbegin Exhibit 9.3 Kinked demand curves Narrbegin Exhibit 9.3 Kinked demand curves -In Exhibit 9.3, the exhibit represents a kinked-demand oligopoly model. Suppose the current price is $50. If one firm in the oligopoly now attempts to lower its price, all firms will: A) follow along demand curve D<sub>1</sub>. B) follow along demand curve D<sub>2</sub>. C) ignore this price decrease and cause the price-reducing firm to move along D<sub>1</sub>. D) ignore this price decrease and cause the price-reducing firm to move along D<sub>2</sub>.
-In Exhibit 9.3, the exhibit represents a kinked-demand oligopoly model. Suppose the current price is $50. If one firm in the oligopoly now attempts to lower its price, all firms will:


A) follow along demand curve D1.
B) follow along demand curve D2.
C) ignore this price decrease and cause the price-reducing firm to move along D1.
D) ignore this price decrease and cause the price-reducing firm to move along D2.

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