Y2 23) Oligopoly - Kinked Demand Curve

Y2 23) Oligopoly - Kinked Demand Curve. Full theory of oligopoly using the kinked demand curve
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[@lorenzo.t.674]

6:42 - - one point for evaluation that you’ve not mentioned is that an oligopoly firm that knows its competitors are less liquid than it may choose to supply at a lower price, forgoing TR in the short run because they know it’ll erode their competitors’ abilities to be at all profitable, putting them in the position of having to either choose to lose the profits of their shareholders or to maintain their price, elbowing them out of the market.

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This is just predatory pricing and a price war no?

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Thank you! Great explaination. This makes me understand better the price war bet Russia and SA and how oil sector behaves currently with this pandemic

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Today I'm having my seminar on oligopoly ..This is how I'm gonna do my seminar as shown in this video ..
Thank you for this wonderful explanation : )

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very helpful for student having difficulties in online classes

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lot of people in my class failed the paper 1 question we got on kinked demand curve.. hopefully they find this video cause its amazing!

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5:05 perfect explanation of the shape of the kinked demand curve thank you dal

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I used this on the 25 marker today about collusion, but apparently it's not on the edexcel spec, would I still get marks for it ?

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Could you explain briefly, why an oligopolistic firm has no supply curve with an appropriate graph?

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great explanation, you're the best! what i can't wrap my head around is, how come P has become the oligopolistic price in the first place? is it insinuated anywhere in the model? thank you

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[@inamqasmi3499]

With reference to Oligopoly Kinked Demand Curve:
If Equilibrium occurs where MC Curve passes through discontinued part of of MR Curve and this Equilibrium will sustain as long as MC Curves while going up or down passes through this gap.Question is that if Price is constant then logically AR and MR would also be constant then how is the Equilibrium occurring at a range of MR Values?

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[@dalma.peller]

Would non price comp, be loyalty cards with points you earn etc which allows consumers to get potential discounts in the furture allowing the firm to have a big market share

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Reason for price stability in Oligopoly market

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[@inamqasmi3499]

If Price is constant then so would b AR and MR .Firms in Oligopoly can have different MC Curves and would try to produce at output where THEIR MC Curve is closest to constant MR but exact equation of MC and MR is less likely?

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[@davidhu9127]

Ohh so the kinked demand curve is used to explain the sticky prices of the oligopolist market structure

[@Self_improvement2023]

5:25 when the quantity demanded is less than the drop in price
4:35 when the rise in price is more than the quantity demanded and it falls
7:25 MC and AC curve in the case of profit making oligopoly

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Thanks you

[@ac3boy1992]

Is game theory still on the aqa a level spec, I thought it wasnt

[@rutvikrele126]

I dont think it is but it helps understanding of oligopolies

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[@amdadulhaque8582]

how would lowering barriers to entry effect the demand curve?

[@mikeslough7586]

would cause an expansion along the demand curve as prices tend to drop when there is increased competition

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[@pnpark]

I am so confused. Is the folding bike market in the UK an oligopoly then because the leader is Brompton and because of its brand loyalty? But they are independent from each other aren’t they? How about the anti-dumping tariff, because that’s a government action then would it just be a monopolistic market with tariff??? Or is it a niche market in a monopolistic market?

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[@Adam-do8ny]

Which diagram do you use for a competitive oligopoly? And for a collusive oligopoly?

[@thomasgeorge1735]

kinked demand for competitive because of price stickiness, monopoly for collusive as when they collude they act as a monopoly would.

[@swllabeysiri3741]

For non collusive oligopoly you can use kinked demand curve model and cournot model. for collusive price leadership and cartels.

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[@krishanthsukumaran4076]

Hi Sir,
In the exam if question requires on kinked demand curve ,Do we have to explain the price increase and decrease (4:39 ) with the diagram?
Thanks.