Oligopolies (Grade 12 NSC Matric Economics): Flashcards

Market with few large firms controlling supply of product/service

Oligopoly where only two companies dominate an industry

Each firm's decisions directly affect its competitors

Advertising, service quality, brand loyalty, product features

Large capital needs, brand loyalty, competing with established firms

Kinked demand curve explaining price stability in oligopolies

High prices, very elastic demand (sensitive to price increases)

Neither raising nor lowering prices improves revenue (kinked curve)

Rival firms cooperate to maximise combined profits

Group of producers acting as collective monopoly to fix prices