Does this "stiff competition" mean that the demand curve for McDonald's Chicken McNuggets is horizontal? Briefly explain.

A. Yes, the demand curve is horizontal because McDonald's has market power.

B. No, the demand curve is not horizontal because Chicken McNuggets are not identical to other chicken products.

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15 April, 14:20

Does this "stiff competition" mean that the demand curve for McDonald's Chicken McNuggets is horizontal? Briefly explain.

A. Yes, the demand curve is horizontal because McDonald's has market power.

B. No, the demand curve is not horizontal because Chicken McNuggets are not identical to other chicken products.

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Lucas · Answer 1

Answer: I found the complete question on Google:

By 2017, McDonald's had stopped selling Chicken McNuggets and other products made from chickens fed antibiotics. The change increased McDonald's costs, but an article in the Wall Street Journal noted that " ... McDonald's ability to raise its prices is limited because of stiff competition."Source: David Kesmodel, Jacob Bunge, and Annie Gasparro, "McDonald's to Curb Antibiotics in Chicken," Wall Street Journal, March 4, 2015. Does this "stiff competition" mean that the demand curve for McDonald's Chicken McNuggets is horizontal? Briefly explain.

And the correct answer is: "B. No, the demand curve is not horizontal because Chicken McNuggets are not identical to other chicken products.".