There has been a concern that oil companies do not readjust prices to benefit consumers when prices fall. The companies are nevertheless quick to adjust upwards when prices rise. This is said not to be in line with the spirit of trade liberalization.
a) Discuss 5 behavior of oligopolies in setting market prices
b) What 6 benefits have accrued from liberalization of trade within your country?
c) There has been a re-introduction of price controls in the oil industry in Kenya, what are 5 disadvantages of imposing price controls? (15 marks)