Oligopoly Flashcards
1
Q
Oligopoly- collusion
A
Firms join together an act as a monopolist
2
Q
Oligopoly- between collusion and competition
A
In between collusion and competition there is a range of possibilities, depending on how the firms behave toward, each other, for examples, they may fight in some markets and not in others or they may compete in some ways but not in others.
3
Q
Oligopoly - Competition
A
Firms compete directly with each other
4
Q
When does Oligopoly occur
A
An oligopoly occurs when a few firms dominate a market. This creates interdependence. They decide whether to collude (cartel) or to compete.
5
Q
What does the kinked demand curve assume
A
The kinked demand curve assumes that price increases by a firm are not followed ; price decreases are followed
