10 In what type of market do these service stations operate? What determines the price of petrol...

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10 In what type of market do these service stations operate?

What determines the price of petrol and what determines the marginal revenue from petrol? Two service stations stand on opposite sides of the road: ABC and XYZ. The owner of ABC doesn’t even have to look across the road to know when XYZ changes its petrol price. When the owner of XYZ raises the price, ABC’s pumps are busy. When XYZ lowers its prices, there’s not a car in sight. Both service stations survive, but each has no control over the price

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Economics

ISBN: 9781118150122

10th European Edition

Authors: Michael Parkin, Dr Melanie Powell, Prof Kent Matthews

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