The Figure Given Below Represents the Total Output and Price

Multiple Choice

The figure given below represents the total output and price produced in an oligopoly market characterized by a dominant firm and a fringe.SF represents the supply curve of the fringe, D is the market demand curve, DRES represents the residual demand curve of the dominant firm, MRRES represents the residual marginal revenue curve of the dominant firm, and MCD represents the marginal cost of the dominant firm.


-Refer to Figure .If the market demand curve D rotates outward (while its vertical intercept remains unchanged) , which of the following changes will be observed in the oligopoly market?

A) The fringe's market share will decline
B) The dominant firm's profits will decrease
C) The marginal cost will decrease
D) The overall market price will decline