olipolgy and game theroy and shit# Flashcards
1
Q
effect of price cuts on firms in oligopolistic market
A
firms are interdependent hence when one firm lowers prices others do the same
Kinked demand curve
Limit pricing to stop new entrants in the market
2
Q
price vs non price strategies
A
Limit Prices
Price leadership
Predatory Pricing
Price Wars
Advertising
Cutting down no. of locations
Opening large stores near competitors
Loyalty Schemes
3
Q
why can price fixing occur
A
High market share
low PED
Weak competition authorities
Lack of substitutes
Firms can communicate and collude easily
