A major prediction of the kinked demand curve model is

A) price stability in oligopolies.
B) price instability in oligopolies.
C) stability of production costs in oligopolies.
D) instability of costs in oligopolies.

Kinked Demand Curve Model

A model in oligopoly markets suggesting that firms may not change their prices because an increase could be ignored by rivals, while a decrease might be matched.

Price Stability

A situation in an economy where prices in general do not change significantly over time, minimizing uncertainty and conducive to economic growth.

Oligopolies

Market structures characterized by a small number of firms that have significant market power, which can influence prices and output levels.