Homework Answers
Game theory mathematically capture behavior in strategic circumstances, in which an individual’s success in making choices depends on the others choices with a motive to use the best strategy to achieve desired results. In the perfectly competitive market the firm is a price taker while in a monopolist market there is no competitor. The perfectly competitive and monopoly market does not depends on the interactions between firms thus we do not need game theory to analyze them. Game theory model has direct relevance to the study of the behaviour and conduct of firms in oligopolistic markets.
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Question 1: Why did we not need game theory when we analyzed perfectly competitive and monopoly markets?
The Prisoner's Dilemma utilizes game theory to explain behavior of firms in: Markets characterized by natural...
The Prisoner's Dilemma utilizes game theory to explain behavior of firms in: Markets characterized by natural monopoly. Monopoly markets. Perfectly competitive markets. Monopolistically competitive markets. Oligopoly markets At 500 units of output, total costs = $50,000 and total variable cost = $5,000. What does average fixed costs (ATC) equal at 500 units? $45,000 $50. $100. $90. Statement 1: Marginal cost pricing occurs when the market price of a good is equal to the marginal cost of the last unit of...
Explain why a monopoly is a price maker but a perfectly competitive firm is a price...
Explain why a monopoly is a price maker but a perfectly competitive firm is a price taker.
Compare consumer surplus when the market is perfectly competitive and when the market is a monopoly.
Compare consumer surplus when the market is perfectly competitive and when the market is a monopoly.
1. Markets and competition In a perfectly competitive market, all producers sell Because of these two...
1. Markets and competition In a perfectly competitive market, all producers sell Because of these two characteristics, both buyers and sellers in perfectly competitive markets are price goods or services. Additionally, there are buyers and sellers. True or False: The market for public utilities, like gas and electricity, does not exhibit the two primary characteristics that define perfectly competitive markets. O True O False identical very different few many We were unable to transcribe this image
Question 1 When there are no externalities, competitive markets when left unregulated are efficient whereas taxed...
Question 1 When there are no externalities, competitive markets when left unregulated are efficient whereas taxed markets are not efficient. True O False True or False. When there are no externalities, competitive markets when left unregulated are efficient whereas markets served by one monopoly are not efficient. True O False When there are externalities, competitive markets when left unregulated are inefficient. True O False When a price ceiling is imposed and the price ceiling charges a price that is higher...
1. What is a monopoly? Name 2 differences between a monopoly and a perfectly competitive market....
1. What is a monopoly? Name 2 differences between a monopoly and a perfectly competitive market. 2. What is the profit maximizing condition for a price-setting monopoly? 3. Show that MR follows the notion "same intercept, twice the slope" of demand. 4. Is a monopoly the most socially optimal market? How does a monopoly differ from a perfectly competitive market? Explain and show in a graph. What is the difference in welfare? 5. At what point would a monopoly decide...
1.In terms of perfectly competitive or monopolistic competition, determine whether one, both, or neither of the...
1.In terms of perfectly competitive or monopolistic competition, determine whether one, both, or neither of the two markets possess the following feature: The firm maximizes profit when P=MC. (may be more than 1) a) This feature is exhibited in perfect competition only. b) This feature is exhibited in a monopoly only. c) This feature is exchibited in both perfect competition and monopoly. d) This feature is exhibited in neither perfect competition or monopoly. 2.In terms of perfectly competitive or monopolistic...
The perfectly competitive firm's demand curve is: Perfectly elastic. Relatively elastic Perfectly inelastic. Relatively inelastic Statement...
The perfectly competitive firm's demand curve is: Perfectly elastic. Relatively elastic Perfectly inelastic. Relatively inelastic Statement 1: In the long run, firms in a monopolistically competitive industry will be producing that quantity that maximize social surplus. Statement 2: In the long run, firms in a monopolistically competitive industry will be producing at the minimum of its ATC curve. Statement (1) is true; statement (2) is false. Statements (1) and (2) are both true. Statement (1) is false; statement (2) is...
1) In comparing the Perfectly Competitive and Pure Monopoly market structures, one aspect they both have in common is th...
1) In comparing the Perfectly Competitive and Pure Monopoly market structures, one aspect they both have in common is that they both: Group of answer choices Face a perfectly elastic demand curve Block entry of other firms into their markets Make production decisions such that MR = MC Have influence over market prices Have no close substitutes for their products
In perfectly competitive markets long term economic profit is zero. If so, why firms bother to...
In perfectly competitive markets long term economic profit is zero. If so, why firms bother to enter such market? Explain this in detail
The Prisoner's Dilemma utilizes game theory to explain behavior of firms in: Markets characterized by natural monopoly. Monopoly markets. Perfectly competitive markets. Monopolistically competitive markets. Oligopoly markets At 500 units of output, total costs = $50,000 and total variable cost = $5,000. What does average fixed costs (ATC) equal at 500 units? $45,000 $50. $100. $90. Statement 1: Marginal cost pricing occurs when the market price of a good is equal to the marginal cost of the last unit of...
1. Markets and competition In a perfectly competitive market, all producers sell Because of these two characteristics, both buyers and sellers in perfectly competitive markets are price goods or services. Additionally, there are buyers and sellers. True or False: The market for public utilities, like gas and electricity, does not exhibit the two primary characteristics that define perfectly competitive markets. O True O False identical very different few many We were unable to transcribe this image
Question 1 When there are no externalities, competitive markets when left unregulated are efficient whereas taxed markets are not efficient. True O False True or False. When there are no externalities, competitive markets when left unregulated are efficient whereas markets served by one monopoly are not efficient. True O False When there are externalities, competitive markets when left unregulated are inefficient. True O False When a price ceiling is imposed and the price ceiling charges a price that is higher...
1. What is a monopoly? Name 2 differences between a monopoly and a perfectly competitive market. 2. What is the profit maximizing condition for a price-setting monopoly? 3. Show that MR follows the notion "same intercept, twice the slope" of demand. 4. Is a monopoly the most socially optimal market? How does a monopoly differ from a perfectly competitive market? Explain and show in a graph. What is the difference in welfare? 5. At what point would a monopoly decide...
The perfectly competitive firm's demand curve is: Perfectly elastic. Relatively elastic Perfectly inelastic. Relatively inelastic Statement 1: In the long run, firms in a monopolistically competitive industry will be producing that quantity that maximize social surplus. Statement 2: In the long run, firms in a monopolistically competitive industry will be producing at the minimum of its ATC curve. Statement (1) is true; statement (2) is false. Statements (1) and (2) are both true. Statement (1) is false; statement (2) is...
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