Asked by
Kennia Jordan
on Nov 26, 2024
Verified
Price leadership represents a situation where oligopolistic firms
A) reduce their reliance on nonprice competition.
B) form a cartel.
C) face a kinked demand curve.
D) tacitly collude.
Price Leadership
Price leadership is a market situation where one dominant firm sets the price for goods or services in an industry, and other firms follow suit, either explicitly or implicitly.
Oligopolistic Firms
Companies operating in an oligopoly market structure, characterized by limited competition and high control over market prices.
Tacit Collusion
An unspoken, implicit agreement among competitors to avoid certain competitive behaviors, such as price undercutting, to stabilize the market and maintain higher prices.
- Analyze the dynamics and implications of oligopolistic market behaviors including cartels, price leadership, and collusion.
Verified Answer
CT
Learning Objectives
- Analyze the dynamics and implications of oligopolistic market behaviors including cartels, price leadership, and collusion.