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| Author: | Simon. J. L. Ben-Ur, J. |
| Title: | Demand, cost and prices in duopoly |
| Journal: | Energy Economics
1988 : APR, VOL. 10:2, p.117-124 |
| Index terms: | DEMAND DUOPOLY PRICE LEVEL |
| Language: | eng |
| Abstract: | The effects of basic sorts of demand changes upon the end price in the duopoly market is investigated. The tool is a set of rich simulation models embodying uncertainty, a multi-period horizon, learning, and realistic interseller competition embodying customer inertia. Surprisingly, it is found that a decrease or increase in the demand at any single price for an oligopolized product may be associated with either an increase or decrease in the price level at which the duopoly will settle. It is shown that the result of a proportional shift in demand depends upon the cost function. With a decreasing marginal cost function, higher demand causes lower prices. |
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