The Kinked Demand Curve theory is a concept used in economics to explain price stability in oligopolistic markets, where a few large firms dominate. This theory suggests that in such markets, the demand curve a firm faces for its products has a distinctive kinked shape due to the expected reactions of competitors to c
Supply-side policies are strategies aimed at increasing the productive capacity of an economy, focusing on boosting the efficiency and productivity of producing goods and services. These policies generally involve measures like encouraging investment in technology and infrastructure, improving education and skills tra
Interdependence the limited number of players, each firm's actions, especially regarding pricing, directly affect the others. For example, if one firm lowers its prices, it can significantly impact the market share of the other firms. This interdependence means that firms in an oligopoly must consider the potential re
Price Elasticity of Demand (PED) is a measure that evaluates how responsive the quantity demanded of a good is to a change in its price. It shows the sensitivity of consumers to price alterations. Formula for Calculation PED is calculated with the formula: PED = (% Change in Quantity Demanded) / (% Change in Price)
Consumers' expectations of future prices can influence current demand. If consumers expect prices to rise in the future, they might buy more of the product now, shifting the current demand curve to the right. Conversely, if they expect prices to fall, they might buy less now, shifting the demand curve to the left. A r
This handbook will help you plan your study time, beat procrastination, memorise the info and get your notes in order.
Our educational experts will help you find the perfect online tutor from top UK universities.