Question

The Paul Sweezy’s kinked demand curve model shows price rigidity under Oligopoly. Explain how.

31 Jul 2024
Answer :
Word Count : 558

The kinked demand curve model, introduced by economist Paul Sweezy in 1939, is a fundamental theory used to explain price rigidity within oligopolistic markets. Oligopoly is a market structure characterized by a small number of firms that dominate the industry, often leading to interdependence in decision-making. In this model, Sweezy illustrates how firms in an oligopoly might experience price rigidity despite changes in demand or cost.

The kinked demand curve assumes that firms in an oligopoly are highly aware of each other's actions and that the behavior of one firm influences the decisions of others. The central concept of the model revolves around the idea that firms believe their competitors will ______ __________ ______ ________ _____ _____ ________ ________ _____ _______ _________ ___.
_____ ___ _________ _________ __________ _______.
__________ ________ ____ _________ ________ ________ ________.
_____ __________ ____ ___ _____ ___ ____ ___ ___.
_____ ____ ______ _______ _____.
__________ _________ ___ ______ _____ ______ _________ ____ _________ ______.
_________ _____ _________ ______ ___ _______ _______ ______ _________ _____ ___ ___.
_________ __________ __________ ________ ___.
___ _______ _____ _________ _________ ________ _________ _________ ________ ______.
_____ _________ ______ _______ ______ ________ ___ _________ _______ ____ ___ _______.
________ _________ _______ _______ _______ ______.
_________ ______ ___ __________ ___ ________ ________ ____ __________ ______.
________ _______ __________ _______ ____ __________.
___ _____ ____ ___ ______ _______ ____ ___.
________ __________ __________ ___ ________ ________ ___ _______.
__________ _________ _______ _______ ___ ________ ___ ___ _________ __________ __________ _____.
__________ ____ _______ ___ ___ _______ ____.
_____ ______ _________ _____ ________ ______.
________ _________ _______ ______ ___ ____ _________ ______ _______ _______ __________ _________.
___ ____ _______ ______ _____ ____ _____ ____ ___ ____ ________.
_________ ________ _____ ____ ____ __________ ____ ________ ____ ________.
_______ _____ __________ _________ ___ _____ ____ ______.
___ ______ _____ ______ _______ ____ _______ _____ ___ _____ _________ __________.
________ _________ _______ ________ __________ __________.
_______ ________ ___ _____ ______ _______ ______ __________ ____ ______ ________ ___.
__________ _________ __________ ________ __________ __________ _____ ______ _________ ________ ______ ______.
____ __________ ___ ____ _____ ____ ______ _____.
______ ________ _____ _____ _________ ______ __________ ______.
________ _______ ____ _________ _______ _____ ____ _____ _________ ______.
___ _____ ___ __________ ____ ______ ___ __________ _______ ______.
__________ __________ _____ ________ _____ ___ _________ _______ ___ ___.
_____ ________ ___ ___ ___ _________ __________ ____.
__________ _______ _____ _________ ___ _________ _____ __________ _________ __________.
___ ________ ________ ________ ______ _______ ___ __________ _______ _________ ______ ___.
___ ________ ____ ______ ____ ___ ___.
______ ______ __________ ____ ______.
_______ ___ _____ ___ ______ __________ _______ _______.
____ ____ ______ ______ _____ __________ __________ __________ ____ _____ ______ _________.
_________ __________ ____ _____ _______ ___ ________ _________ ________ ___.
________ _____ _____ _________ _________.
_________ ___ ________ ___ ______ ___ _________ _______.
____ ____ _________ ___ __________ ___ ___ _______ ___ _______.
______ ___ __________ ________ ______ ______ __________.
_____ _______ _________ ________ _________ _____ ____ ___ ______ ___ _______ ___.
________ ________ _______ ____ __________ __________ _________ __________ _____ __________.
_______ ________ __________ _________ _______.
________ ___ _______ _________ _______ ________ __________ __________ _____ _______ ___.
______ __________ ______ ________ ___ ______ _____ ______ _________.
_________ ______ ___ ____ _____ ________ __________ _________.
__________ __________ __________ _______ _____ __________ ___ ___ __________.
______.
Get Full Answer on WhatsApp

Related Questions

What is the concept of efficiency in economics? How is the efficient allocation of resources done among firms?

What is an Income consumption curve? Draw the Income consumption curve for an inferior good.

What are the policy instruments available for government intervention to regulate inefficient market situations?

In a duopolist market two firms can produce at a constant average and marginal cost of AC = MC = 2. They face the market demand curve P = 14 – Q, where Q = Q1 + Q2, here Q1 is the output of Firm 1, Q2 is the output of Firm 2. In the Cournot’s model:
(i) Find the action-reaction functions of the two firms.
(ii) What are the profits of the two firms.
(iii) Calculate the profit maximizing levels of output (Q1 and Q2) and price.

What do you understand by the term “Excess Capacity”?

Elucidate the features existing under Oligopolistic market structure

Why do you find variations in the wage-rates across different professions? Give reasons as to why a professor is paid higher salary than a school teacher?

IGNOU Solved Assignments Assignments Ignou Projects Project Previous Year Solved Exam Papers Notes Notes Sample Question Papers Sample Question Papers
Login Cart
IGNOU NEWS
Assignment Submission Last Date Extended Till 30 June 2026 Click Here★★★IGNOU June 2026 TEE Date Sheet Released Click Here★★★
Top
📞
Call Support Instant phone assistance The Paul Sweezy’s kinked demand curve model shows price rigidity
→
🟢
WhatsApp Chat Fast live messaging
→
Email Us Business enquiries & support
→