Question

Guys I need help on a question regarding sticky prices in an oligopoly.

Why are prices sticky???

Answer 1

When applied to prices, it means that the prices charged for certain goods are reluctant to change despite changes in input cost or demand patterns. Price stickiness can also occur in just one direction, as in "sticky-up" or "sticky-down".

Answer 2

Thank you, that's one point I could add but I need to write a 15 mark essay on it

Answer 3

It's sticky because in a oligopoly, the consumers have very few choices to choose from. They can't just switch to something else because there's nothing else.