Exam 15: Oligopoly and Game Theory

When cartels are successful at driving up prices,:

A dominant strategy is a strategy that has a higher payoff than any other strategy no matter what the other player does.

A cartel can remain powerful even when all the members engage in secret price cuts.

Figure: Demand 3 If the two-firm oligopoly facing the market in this diagram is currently producing at the competitive output level and one of the firms reduces output by 4 units, the firm's profits would increase from _________________.

The Sherman Antitrust Act of 1890:

Within OPEC, cheating is associated with:

Cheating in cartels is most likely to occur when actions are:

Cartels in the United States were outlawed with the passage of the:

When cheating is less profitable or easier to detect, a cartel will be easier to sustain.

Cartels tend to be more successful when:

In reference to the Lowe's and Home Depot example in the textbook (prisoner's dilemma), equilibrium will occur when:

There was a dramatic fall in the price of oil in:

It is easier to maintain a cartel in a market for a(n) ________ than in a market for a(n) ________.

Which of the following is NOT a reason why cartels tend to collapse and lose their power?

In forming a cartel:

Cartel agreements tend to fail: I. if they produce manufactured rather than natural goods. II. if they produce natural rather than manufactured goods. III. in the long run as demand curves become more elastic.

Frequent flyer programs are a form of price discrimination.

Which of the following statements regarding cartels is FALSE?

The Sherman Antitrust Act prevents Microsoft from becoming too large.

A group of suppliers who tries to act as if they are a monopoly is called a(n):