According to the kinked demand curve model of oligopoly, if a firm decides to alter its price from the prevailing market price (at the "kink"), what is the expected outcome for its total revenue?
Total revenue will rise if the price is increased and fall if the price is decreased.
Total revenue will fall if the price is increased and rise if the price is decreased.
Total revenue will remain unchanged regardless of whether the price is increased or decreased.
Total revenue will fall whether the firm decides to increase or decrease its price.
42 exam-style questions on OCR A Level Economics Market structures, covering Perfect competition, Monopoly, Monopolistic competition, Oligopoly, and Contestable markets. Each one has a worked solution and a mark scheme showing where the marks go.