Problem
A parking garage charges $10 a day. Whenever it tries to raise its price, the other parking garages in the area keep their prices constant and it loses customers to the cheaper garages. However, when the parking garage lowers its price, the other garages almost always match the price reduction. Which type of oligopoly behavior best explains this situation? If the parking garage business has marginal costs that generally vary only a small amount, should it change the price it charges when its marginal costs change a little?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.