1. 1 Oligopoly MIKROEKONOMI

2. 2 Oligopoly Few sellers of a product Nonprice competition Barriers to entry Duopoly - Two sellers Pure oligopoly - Homogeneous product Differentiated oligopoly - Differentiated product

3. 3 Sources of Oligopoly Economies of scale Large capital investment required Patented production processes Brand loyalty Control of a raw material or resource Government franchise Limit pricing

4. 4 Kinked Demand Curve Model Proposed by Paul Sweezy If an oligopolist raises price, other firms will not follow, so demand will be elastic If an oligopolist lowers price, other firms will follow, so demand will be inelastic Implication is that demand curve will be kinked, MR will have a discontinuity, and oligopolists will not change price when marginal cost changes

5. 5 Kinked Demand Curve Model