​Double markup problems arise when

A) ​upstream firms have no market power
B) downstream firms have no market power
C) upstream and downstream products are complementary in demand 
D) ​upstream and downstream firm's pricing decisions tend to increase the demand for the other product

Complementary Demand

Refers to products or services for which the demand increases or decreases together because they are used together, like smartphones and data plans.

Double Markup

A pricing strategy where a product is marked up twice before it reaches the final consumer: first by the wholesaler then by the retailer, leading to a higher final price.

Upstream Firms

Companies involved in the early stages of production or supply chain, such as raw material extraction or initial processing, before manufacturing.