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Consider a Dominant Firm Model in Which the Elasticity of Market

Question 86

Multiple Choice

Consider a dominant firm model in which the elasticity of market demand is 1,the dominant firm's market share is 0.5,and the elasticity of supply of the competitive fringe firms is 4.What would be the dominant firm's elasticity of demand?


A) 2
B) 4
C) 6
D) 8

Correct Answer:

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