Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
(Kinky Demand Curve) Short Period
Kinked demand curve was first used by Prof. Paul M. Sweezy to elucidate price rigidity under oligopoly. In an oligopoly market, firm knows that if it increases price, other firms won't follow; though if price is reduced, other firms will follow price reduction. In some respect, price output analysis in oligopoly is simple. Because every seller wants to avoid uncertainty, each oligopolistic firm will adhere to the point of kink where itis safe and where it can anticipate the reaction of its rivals. Though the firm will neither decrease nor increase price.
Figure: Kinked Demand Curve
This is a significant consequence of the existence of the kink in demand curve of firm. Since of the vertical section in MR, which is uncertainty range, without affecting the price or level of output. Under these situations, equality between MR and MC won't determine the point of equilibrium. The profits will, though, be determined as in any other market, by difference between AC andAR. With a given marginal cost of production, OP is more about to be the profit-maximising price. Length of the discontinuity portion in MR relies on the relative elasticity of demand at point E of AR. The greater the elasticity of demand of portion of AR above point E and the lower the elasticity of demand of the portion of AR below point discontinuity portion of MR, the bigger will be discontinuity portion of MR. Figure above demonstrates that price is fixed at OP and output is OM.
what is cardinal and ordinal utility?.
Q. Types of production function? Production function is of two different forms: The variable proportion production function The fixed proportion production functio
Types of Income Elasticity of demand Depending upon the product, demand might increase or decrease in response to a rise in income. There are thus five types of income Elasti
Why Do Monopolies Exist? Monopolists have market power and as a consequence will charges higher prices and generate less output than a competitive industry. It produces profit
Q. Show the Long Term Goals - Demand forecast? Long Term Goals: If the demand forecast period is more than a year, in that scenario it's termed as long term forecast. Follow
What is Cyert and March's behavior theory? What are the demerits.
Q 3. What is Demand Forecasting? Explain in brief various methods of forecasting demand.
Explain the Decision-making theory Decision-making theory and game theory that recognise the conditions of imperfect knowledge and uncertainty under which business managers ope
Problems of prices and Incomes policy i. Confrontation The imposition of the prices and incomes policy, voluntary or statutory, risks the possibility of confrontation w
the demand for widgets(x) is given by: px=160 -4x the production of widget has the following average variable cost: Avc=2x-20 fixed cost are 162 calculate the output level of widg
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd