1. Network externalities are important for a. gas stations. b. AARP, an organization that advocates for...
1. Network externalities are important for a. gas stations.
b. AARP, an organization that advocates for seniors.
c. slot machines
d. music concerts
2.
|
Firm B |
|||
|
Keep agreement |
Break agreement |
||
| Firm A |
Keep agreement |
Firm A profit = $50 |
Firm A profit = $100 |
|
Break agreement |
Firm A profit = $5 |
Firm A profit = $10 |
|
Given the matrix above, which of the following is correct?
| a. |
Firm A’s dominant strategy is to keep the agreement, and Firm B’s dominant strategy is to break the agreement |
|
| b. |
Firm A’s dominant strategy is to break the agreement, and Firm B’s dominant strategy is to keep the agreement |
|
| c. |
Firm A’s dominant strategy is to break the agreement, and Firm B’s dominant strategy is to break the agreement |
|
| d. |
Firm A’s dominant strategy is to keep the agreement, and Firm B’s dominant strategy is to keep the agreement |
3.
Which of the following statements is true?
| a. |
Compared to an oligopoly market, the monopoly output is higher |
|
| b. |
prices are higher when an oligopoly market is compared to competitive markets |
|
| c. |
prices are lower when an oligopoly market compared to monopoly prices |
|
| d. |
output will be higher for oligopoly market, than under monopoly |
Homework Answers
Add Answer to:
1. Network externalities are important for a. gas stations.
b. AARP, an organization that advocates for...
Consider the following payoff matrix in which the numbers indicate the profit in millions of dollars...
Consider the following payoff matrix in which the numbers
indicate the profit in millions of dollars for an oligopoly based
on either a high-price or a low-price strategy.
a. Situation
1: Each firm chooses a high-price
strategy.
Result: Each firm
will earn $ 200 million in profit for a total of $ 400 million for
the two firms.
b. Situation 2: Firm X chooses a
low-price strategy while Firm Y maintains a high-price
strategy.
Result: Firm X will earn $250...
Chapter 13 Vocabulary a. Non-price competition b. Cartel c. Prisoner’s dilemma d. Excess capacity e. Collusion...
Chapter 13 Vocabulary a. Non-price competition b. Cartel c. Prisoner’s dilemma d. Excess capacity e. Collusion f. Differentiated product g. Herfindahl index h. Duopoly i. Monopolistic competition j. Oligopoly ( ) 7. Five or fewer firms produce most of the output in an industry, or control a large share of the market. ( ) 5. Most type of retail stores, like J. Crew, fall into this market category. ( ) 8. This is a two-firm oligopoly. ( ) 1. In...
Chapter 14 Vocabulary Name: a. Kinked demand curve b. Cartel c. Price leadership d. Game theory...
Chapter 14 Vocabulary Name: a. Kinked demand curve b. Cartel c. Price leadership d. Game theory e. Collusion f. Strategic behavior g. Homogeneous oligopoly h. Price war i. Differentiated oligopoly j. Oligopoly ( ) Five or fewer firms produce most of the output in an industry, or control a large share of the market. ( ) Many consumer goods, like automobiles and sporting goods, are produced by a few firms. ( ) This is when firm’s break from pricing decision...
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1. A cartel is a. Not illegal in the United States. b. An organization intended to increase competition in an industry. c. A public agreement between firms or countries to restrict production and raise prices. d. A type of market structure. 2. A monopoly a. Produces less output than a competitive industry, ceteris paribus. b. Charges the same price as a competitive industry, ceteris paribus. c. Maximizes profits at the output where P = MR d. Maximizes profits at the...
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This problem set is partitioned into four sections. Section I examines price discrimination in the airline...
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D) shifts to the right and then moves back C) They guarantee that a market wil...
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POM CUCI 1. Because of monopoly, consumers experience___than they do with perfect competition. A. more choices...
POM CUCI 1. Because of monopoly, consumers experience___than they do with perfect competition. A. more choices B. larger quantities C. higher quality D. higher prices 2. Which statement concerning monopoly is TRUE? A. Monopoly firms are always larger than are perfectly competitive firms. B. A monopoly has no rivals. C. Barriers to entry do not prevent other firms from entering a monopolized industry. D. Monopolists produce more output than does a competitive market with the same demand and cos structure....
Consider the following payoff matrix in which the numbers
indicate the profit in millions of dollars for an oligopoly based
on either a high-price or a low-price strategy.
a. Situation
1: Each firm chooses a high-price
strategy.
Result: Each firm
will earn $ 200 million in profit for a total of $ 400 million for
the two firms.
b. Situation 2: Firm X chooses a
low-price strategy while Firm Y maintains a high-price
strategy.
Result: Firm X will earn $250...
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(Table: Christie' and Sotheby's) Each cell of this table presents the revenues can the auction houses, Christie's and Sotheby's. Revenues are based on the type or commission each firm charges its clients, as well as what commission the other Christie's revenues are listed first in each cell, then Sotheby's. Categy of chan the respection low price. This If both firms cooperate and act like a cartel: Sotheby's will charge a price and Christie's will charge a thing Chich/low price. This...
D) shifts to the right and then moves back C) They guarantee that a market wil be competitive. Di All of the above 26. The price elasticity of demand ean he found by: A) measuring absolute changes in price and quantity demanded B) comparing the percentage change in quantity demanded to the percentage change in C) examining only the slope of the demand curve. D) knowing that when price changes, the quantity demanded goes in tbe opposite direction A) that...
POM CUCI 1. Because of monopoly, consumers experience___than they do with perfect competition. A. more choices B. larger quantities C. higher quality D. higher prices 2. Which statement concerning monopoly is TRUE? A. Monopoly firms are always larger than are perfectly competitive firms. B. A monopoly has no rivals. C. Barriers to entry do not prevent other firms from entering a monopolized industry. D. Monopolists produce more output than does a competitive market with the same demand and cos structure....
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