Question 1

Imagine a duopoly in which two firms,A and B,produce the monopoly profit-maximizing output and equally share the economic profit.If firm A increases output,

Accepted Answer

A)  both firms' profits increase. 
B)  firm A's profits increase and firm B's profits decrease. 
C)  firm B's profits increase and firm A's profits decrease. 
D)  both firms' profits decrease. 
E)  firm A's profits increase and firm B's profits do not change. 
A)  both firms' profits increase. 
B)  firm A's profits increase and firm B's profits decrease. 
C)  firm B's profits increase and firm A's profits decrease. 
D)  both firms' profits decrease. 
E)  firm A's profits increase and firm B's profits do not change.

Question 2

"The duopolists' dilemma occurs when firms in a duopoly coordinate their decisions to achieve the best possible outcome." Is the previous statement correct or incorrect? Why?

Accepted Answer

The statement is incorrect.The

Question 3

-Suppose Intel and AMD can each charge either $300 or $200 for a CPU (the computing unit of a computer).The above table illustrates the payoffs,in millions of dollars,from each of the four possible outcomes that could occur in their duopoly setting.If Intel charges $300 and AMD charges $300,then Intel's profit will be ________ million and AMD's profit will be ________ million.

Accepted Answer

A)  $320; $160 
B)  $200; $180 
C)  $500; $100 
D)  $450; $220 
E)  $320; $220 
A)  $320; $160 
B)  $200; $180 
C)  $500; $100 
D)  $450; $220 
E)  $320; $220

Question 4

Which of the following provisions requires a firm to buy all of a particular item from a single firm?

Accepted Answer

A)  tying arrangement 
B)  requirements contracts 
C)  exclusive dealing 
D)  territorial confinement 
E)  quantity discrimination 
A)  tying arrangement 
B)  requirements contracts 
C)  exclusive dealing 
D)  territorial confinement 
E)  quantity discrimination

Question 5

A firm faces a small number of competitors.This firm is competing in

Accepted Answer

A)  a monopoly. 
B)  monopolistic competition. 
C)  an oligopoly. 
D)  perfect competition. 
E)  a perfect multi-firm monopoly. 
A)  a monopoly. 
B)  monopolistic competition. 
C)  an oligopoly. 
D)  perfect competition. 
E)  a perfect multi-firm monopoly.

Question 6

A Nash equilibrium
i.is named after the Nobel prize winning economist,John Nash.
ii.occurs when each player chooses the best strategy given the strategy of the other player.
iii.must give the best possible outcome for both players.

Accepted Answer

A)  i only 
B)  ii only 
C)  iii only 
D)  i and ii 
E)  ii and iii 
A)  i only 
B)  ii only 
C)  iii only 
D)  i and ii 
E)  ii and iii

Question 7

Tying arrangements are

Accepted Answer

A)  illegal if they substantially lessen competition. 
B)  used by regulators to force a monopoly to produce an efficient amount of production. 
C)  used by regulators to force a monopoly to charge an efficient price. 
D)  illegal according to the Sherman Act. 
E)  necessary in order for a firm to price discriminate. 
A)  illegal if they substantially lessen competition. 
B)  used by regulators to force a monopoly to produce an efficient amount of production. 
C)  used by regulators to force a monopoly to charge an efficient price. 
D)  illegal according to the Sherman Act. 
E)  necessary in order for a firm to price discriminate.

Question 8

Why are cartels among firms usually kept secret?

Accepted Answer

Cartels are typically kept secret becaus

Imagine a duopoly in which two firms,A and B,produce the monopoly profit-maximizing output and equally share the economic profit.If firm A increases output,

"The duopolists' dilemma occurs when firms in a duopoly coordinate their decisions to achieve the best possible outcome." Is the previous statement correct or incorrect? Why?

Which of the following provisions requires a firm to buy all of a particular item from a single firm?

A firm faces a small number of competitors.This firm is competing in

A Nash equilibrium i.is named after the Nobel prize winning economist,John Nash. ii.occurs when each player chooses the best strategy given the strategy of the other player. iii.must give the best possible outcome for both players.

Tying arrangements are

Why are cartels among firms usually kept secret?

Getting Started

The U.S.and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Markets for Factors of Production

Economic Inequality

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Exam 18: Oligopoly

Imagine a duopoly in which two firms,A and B,produce the monopoly profit-maximizing output and equally share the economic profit.If firm A increases output,

"The duopolists' dilemma occurs when firms in a duopoly coordinate their decisions to achieve the best possible outcome." Is the previous statement correct or incorrect? Why?

Which of the following provisions requires a firm to buy all of a particular item from a single firm?

A firm faces a small number of competitors.This firm is competing in

A Nash equilibrium i.is named after the Nobel prize winning economist,John Nash. ii.occurs when each player chooses the best strategy given the strategy of the other player. iii.must give the best possible outcome for both players.

Tying arrangements are

Why are cartels among firms usually kept secret?

Getting Started

The U.S.and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Markets for Factors of Production

Economic Inequality

Filters