Economics 9708 · AS & A Level · 7.6

7.6 — practice question

Firms in oligopoly usually aim to maximise profits. In a non-collusive market, how would this shape the pricing behaviour of the firms involved in the oligopoly?

  • AA price is fixed for the product that never changes throughout its life cycle.
  • BFirms will agree on the level of advertising costs for a new product.
  • CIf one firm raises its price, other firms will maintain their original price to increase their market share.
  • DIf one firm lowers its price, other firms will increase their price.

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