Question 1

A Nash equilibrium occurs when each player in a game takes the ________ given the action of the other player.

Accepted Answer

A) worst possible action for himself or herself 
B) best possible action for himself or herself 
C) most unpredictable possible action 
D) most mutually beneficial possible action 
E) best possible action for the other player 
A) worst possible action for himself or herself 
B) best possible action for himself or herself 
C) most unpredictable possible action 
D) most mutually beneficial possible action 
E) best possible action for the other player

Question 2

For a firm in monopolistic competition,define efficient scale and excess capacity.Briefly explain each.

Accepted Answer

The efficient scale is the quantity prod

Question 3

Monopolistic competition is efficient when compared to

Accepted Answer

A) perfect competition. 
B) complete product uniformity. 
C) the short run. 
D) the long run. 
E) None of the above answers is correct. 
A) perfect competition. 
B) complete product uniformity. 
C) the short run. 
D) the long run. 
E) None of the above answers is correct.

Question 4

To maximize its profit,the firm in the figure above will produce ________ jeans and set a price ________ per pair of jeans.

Accepted Answer

A) 150;between $50 and $25 
B) 125;$25 
C) 125;$50 
D) 125;$75 
E) None of the above answers are correct. 
A) 150;between $50 and $25 
B) 125;$25 
C) 125;$50 
D) 125;$75 
E) None of the above answers are correct.

Question 5

If the Herfindahl-Hirschman Index for an industry is 8,528,is the industry competitive or concentrated?

Accepted Answer

With a Herfindahl-Hirschman In

Question 6

The Herfindahl-Hirschman Index measures market concentration in an industry by summing the square of the percentage market shares for

Accepted Answer

A) the 4 largest firms. 
B) the 50 smallest firms. 
C) the 4 smallest firms. 
D) the 50 largest firms. 
E) all firms in the market. 
A) the 4 largest firms. 
B) the 50 smallest firms. 
C) the 4 smallest firms. 
D) the 50 largest firms. 
E) all firms in the market.

Question 7

It would be impossible for members of the fast-food industry to collude to fix prices because

Accepted Answer

A) there are too many fast-food firms in the market. 
B) collusion is illegal. 
C) there are not enough fast-food firms in the market. 
D) the price of fast-food is too low. 
E) demanders would not buy from firms that collude. 
A) there are too many fast-food firms in the market. 
B) collusion is illegal. 
C) there are not enough fast-food firms in the market. 
D) the price of fast-food is too low. 
E) demanders would not buy from firms that collude.

Question 8

A cartel is a collusive agreement among a number of firms that is designed to

Accepted Answer

A) expand output and lower prices but not to a predatory level. 
B) restrict output and lower prices to a predatory level. 
C) restrict output and raise prices. 
D) expand output and raise prices. 
E) expand output and lower prices to a predatory level. 
A) expand output and lower prices but not to a predatory level. 
B) restrict output and lower prices to a predatory level. 
C) restrict output and raise prices. 
D) expand output and raise prices. 
E) expand output and lower prices to a predatory level.

Question 9

In an industry with a large number of firms,

Accepted Answer

A) each firm will produce a large quantity,relative to market demand. 
B) one firm will dominate the market. 
C) collusion is impossible. 
D) competition is eliminated. 
E) barriers to exit must exist. 
A) each firm will produce a large quantity,relative to market demand. 
B) one firm will dominate the market. 
C) collusion is impossible. 
D) competition is eliminated. 
E) barriers to exit must exist.

Question 10

If the Herfindahl-Hirschman Index in the market for single-use cameras equals 10,000 ,then the single-use camera industry is best characterized as

Accepted Answer

A) a monopoly. 
B) monopolistic competition. 
C) an oligopoly. 
D) perfect competition. 
E) either a monopoly or monopolistic competition. 
A) a monopoly. 
B) monopolistic competition. 
C) an oligopoly. 
D) perfect competition. 
E) either a monopoly or monopolistic competition.

Question 11

-The above figure shows a restaurant engaged in monopolistic competition with other restaurants.The equilibrium quantity at this restaurant is ________ meals per day.

Accepted Answer

A) less than 150 
B) between 151 and 250 
C) between 251 and 350 
D) between 451 and 450 
E) more than 451 
A) less than 150 
B) between 151 and 250 
C) between 251 and 350 
D) between 451 and 450 
E) more than 451

Question 12

Sally's Mom is pretty sure her twins,Tim and John,together cut the hair off Sally's Barbie doll.She talks to them separately and gives them the following options.If they both confess they will have to pay Sally $10 each.If Tim confesses and John does not confess,Tim pays $15 and John pays $8.If Tim does not confess and John confesses,Tim has to pay $8 and John $15.If both do not confess,they both pay her $14.Sally's Mom has them in separate rooms and they cannot talk to each other.
a.Complete the payoff matrix below.   
b.If they reach the Nash equilibrium,what will Tim and John do?

Accepted Answer

@#IMG-DLM& a.The complete payoff matrix

Question 13

-Suppose there are 7 firms in the candy industry with the market shares shown above.What is the HHI for the industry?

Accepted Answer

A) 1850 
B) 2000 
C) 6400 
D) 100 
E) 20 
A) 1850 
B) 2000 
C) 6400 
D) 100 
E) 20

Question 14

In monopolistic competition,each firm supplies a small part of the market.This occurs because

Accepted Answer

A) there are barriers to entry. 
B) there are no barriers to exit. 
C) there is a large number of firms. 
D) firms produce differentiated products. 
E) there is a large number of buyers. 
A) there are barriers to entry. 
B) there are no barriers to exit. 
C) there is a large number of firms. 
D) firms produce differentiated products. 
E) there is a large number of buyers.

Question 15

Which of the following is the best example of a monopolistically competitive industry?

Accepted Answer

A) land-based long distance telephone service 
B) wheat farming 
C) the local electricity producer 
D) manufacturing of shirts 
E) cable television 
A) land-based long distance telephone service 
B) wheat farming 
C) the local electricity producer 
D) manufacturing of shirts 
E) cable television

Question 16

The four largest firms in an industry account for the following value of industry revenues: 12 percent,8 percent,5 percent and 4 percent.Calculate the four-firm concentration ratio.Would this industry be regarded as competitive or concentrated?

Accepted Answer

The four-firm concentration ra

Question 17

The four-firm concentration ratio is the percentage of ________ accounted for by the four largest firms in an industry.

Accepted Answer

A) profit 
B) supply 
C) total revenue 
D) total cost 
E) marginal cost 
A) profit 
B) supply 
C) total revenue 
D) total cost 
E) marginal cost

Question 18

If a monopolistically competitive seller's marginal cost is $3.56,the firm will not change its output if

Accepted Answer

A) its marginal revenue is less than $3.56. 
B) its marginal revenue is equal to $3.56. 
C) its marginal revenue is more than $3.56. 
D) its average total cost is equal to $3.56. 
E) Both answers B and D are correct. 
A) its marginal revenue is less than $3.56. 
B) its marginal revenue is equal to $3.56. 
C) its marginal revenue is more than $3.56. 
D) its average total cost is equal to $3.56. 
E) Both answers B and D are correct.

Question 19

Which of the following four-firm concentration ratios would be the best indication of a perfectly competitive industry?

Accepted Answer

A) 2 percent 
B) 31 percent 
C) 78 percent 
D) 100 percent 
E) 50 percent 
A) 2 percent 
B) 31 percent 
C) 78 percent 
D) 100 percent 
E) 50 percent

Question 20

Which of the following is true about monopolistic competition but false about perfect competition?

Accepted Answer

A) There is a large number of independently acting sellers. 
B) There are no barriers to entry. 
C) Firms can earn an economic profit in the short run. 
D) Firms compete on their product's price as well as its quality and marketing. 
E) Firms cannot earn an economic profit in the long run. 
A) There is a large number of independently acting sellers. 
B) There are no barriers to entry. 
C) Firms can earn an economic profit in the short run. 
D) Firms compete on their product's price as well as its quality and marketing. 
E) Firms cannot earn an economic profit in the long run.

A Nash equilibrium occurs when each player in a game takes the ________ given the action of the other player.

For a firm in monopolistic competition,define efficient scale and excess capacity.Briefly explain each.

Monopolistic competition is efficient when compared to

To maximize its profit,the firm in the figure above will produce jeans and set a price per pair of jeans.

If the Herfindahl-Hirschman Index for an industry is 8,528,is the industry competitive or concentrated?

The Herfindahl-Hirschman Index measures market concentration in an industry by summing the square of the percentage market shares for

It would be impossible for members of the fast-food industry to collude to fix prices because

A cartel is a collusive agreement among a number of firms that is designed to

In an industry with a large number of firms,

If the Herfindahl-Hirschman Index in the market for single-use cameras equals 10,000 ,then the single-use camera industry is best characterized as

-The above figure shows a restaurant engaged in monopolistic competition with other restaurants.The equilibrium quantity at this restaurant is ________ meals per day.

-Suppose there are 7 firms in the candy industry with the market shares shown above.What is the HHI for the industry?

In monopolistic competition,each firm supplies a small part of the market.This occurs because

Which of the following is the best example of a monopolistically competitive industry?

The four largest firms in an industry account for the following value of industry revenues: 12 percent,8 percent,5 percent and 4 percent.Calculate the four-firm concentration ratio.Would this industry be regarded as competitive or concentrated?

The four-firm concentration ratio is the percentage of ________ accounted for by the four largest firms in an industry.

If a monopolistically competitive seller's marginal cost is $3.56,the firm will not change its output if

Which of the following four-firm concentration ratios would be the best indication of a perfectly competitive industry?

Which of the following is true about monopolistic competition but false about perfect competition?

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Externalities: Pollution, education, and Health Care

Production and Cost

Perfect Competition

Monopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters

Exam 13: Monopolistic Competition and Oligopoly

A Nash equilibrium occurs when each player in a game takes the ________ given the action of the other player.

For a firm in monopolistic competition,define efficient scale and excess capacity.Briefly explain each.

Monopolistic competition is efficient when compared to

To maximize its profit,the firm in the figure above will produce ________ jeans and set a price ________ per pair of jeans.

If the Herfindahl-Hirschman Index for an industry is 8,528,is the industry competitive or concentrated?

The Herfindahl-Hirschman Index measures market concentration in an industry by summing the square of the percentage market shares for

It would be impossible for members of the fast-food industry to collude to fix prices because

A cartel is a collusive agreement among a number of firms that is designed to

In an industry with a large number of firms,

If the Herfindahl-Hirschman Index in the market for single-use cameras equals 10,000 ,then the single-use camera industry is best characterized as

-The above figure shows a restaurant engaged in monopolistic competition with other restaurants.The equilibrium quantity at this restaurant is ________ meals per day.

-Suppose there are 7 firms in the candy industry with the market shares shown above.What is the HHI for the industry?

In monopolistic competition,each firm supplies a small part of the market.This occurs because

Which of the following is the best example of a monopolistically competitive industry?

The four largest firms in an industry account for the following value of industry revenues: 12 percent,8 percent,5 percent and 4 percent.Calculate the four-firm concentration ratio.Would this industry be regarded as competitive or concentrated?

The four-firm concentration ratio is the percentage of ________ accounted for by the four largest firms in an industry.

If a monopolistically competitive seller's marginal cost is $3.56,the firm will not change its output if

Which of the following four-firm concentration ratios would be the best indication of a perfectly competitive industry?

Which of the following is true about monopolistic competition but false about perfect competition?

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Externalities: Pollution, education, and Health Care

Production and Cost

Perfect Competition

Monopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters

To maximize its profit,the firm in the figure above will produce jeans and set a price per pair of jeans.