Decrease in price but will not follow increase. The correct answer is
option (B).
Oligopoly pricing are not as stiff as the kinked-demand theory predicts under macroeconomic instability. Price inflexibility is explained by the kinked-demand curve, but not by the price itself.
When a small number of significant sellers or manufacturers dominate a considerable percentage of a market or an entire sector, the situation is referred to as an oligopoly. The desire to maximize profits frequently gives birth to oligopolies, which can lead to corporate cooperation. A limited number of companies compete in an oligopoly market and are aware of how their pricing and production strategies are interdependent. There aren't many companies, so each one has a reasonable amount of market power.
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