Happyland is one of five amusementparks on Sunshine Island. The graph below show

Question

Happyland is one of five amusementparks on Sunshine Island. The graph below shows Happyland's kinkeddemand curve (D1D2) and the resulting marginal revenue curve(MR1MR2). The graph also shows two possible marginal cost curves(MC1 and MC2). Assume Happyland's marginal cost is represented byMC1.

Happyland is one of five amusementparks on Sunshine Island. The graph below shows Happyland's kinkeddemand curve (D1D2) and the resulting marginal revenue curve(MR1MR2). The graph also shows two possible marginal cost curves(MC1 and MC2). Assume Happyland's marginal cost is represented byMC1.

Explanation / Answer

C.   Match the price decrease Because demand curve is now more elastic thus, it competitiorsdo not want to lose market share, they better match pricedecrease ****Use my answer as reference only C.   Match the price decrease

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