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Question

Q1. Which one of the following market structures has a kinked demand curve ?

Perfect Competition

Monopoly

Oligopoly

Monopolistic Competition

Accepted Answer

Answer : Oligopoly

An oligopoly is a market dominated by a few producers, each of which has a control over the market. The kinked demand curve model developed first by the economist Paul Sweezy assumes that a business might face a dual demand curve for its product based on the likely reactions of other firms in the market to a change in its price or another variable.
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