Exam 11: Oligopoly and Monopolistic Competition

In the Cournot model,if one firm increases its output

The ability to set a price greater than marginal cost guarantees an economic profit for the monopolistic competitor (assuming P > AC).

The market demand that is not met by other sellers in a market is known as a firm's

Cartels can detect cheating by

When deciding on output levels,members of a cartel

Which of the following statements is FALSE?

Two identical firms that share a market and produce a homogeneous good will find the Bertrand Oligopoly LEAST attractive because

In the long run,firms in markets that are ________ earn zero economic profits.

An example of a market where a Bertrand model would be plausible is the market for

In a Bertrand model,market power is a function of

Mergers often increase profit by

In the simplest version of the Cournot model,we assume

If AC > p where MR = MC

Price and quantity in Bertrand and Cournot models

One criticism of the Bertrand pricing model is that

Firms in a monopolistically competitive market face ________ demand curves and earn ________ economic profits in the long run.

-The above figure shows the reaction functions for two pizza shops in a small isolated town.Firm B producing 100 pizzas and firm A producing 50 pizzas is not a Cournot equilibrium because

If differentiation makes the market demand curve less elastic,then

In the Cournot model,the output that a firm chooses to produce increases as

A Nash equilibrium occurs when