question
The kinked demand curve model:
answer
explains why prices do not change in some oligopolistic industries.
question
An oligopolistic industry is not characterized by:
answer
firms making decisions independently of competitors' decisions.
question
Tangency solution refers to:
answer
the long-run equilibrium under monopolistic competition.
question
In Figure 12.3:
a successful cartel will charge price P2.
at price P1 the cartel is stable.
at price P1 if everyone cheats in the cartel, everyone will be better off.
at price P1 the cartel is acting as a monopolist.
a successful cartel will charge price P2.
at price P1 the cartel is stable.
at price P1 if everyone cheats in the cartel, everyone will be better off.
at price P1 the cartel is acting as a monopolist.
answer
at price P1 the cartel is acting as a monopolist.
question
In Figure 12.1, at price P1 and quantity Q1:
average revenue is falling faster than marginal revenue.
average revenue equals average cost.
average cost is below marginal cost.
average cost is falling faster than average revenue.
average revenue is falling faster than marginal revenue.
average revenue equals average cost.
average cost is below marginal cost.
average cost is falling faster than average revenue.
answer
average revenue equals average cost.
question
Monopolistically competitive industries:
answer
produce a variety of products that consumers can choose from.
question
The major difference between monopolistic competition and perfect competition is that:
answer
all the monopolistically competitive firms produce a slightly different product whereas perfectly competitive firms produce exactly the same product.
question
Which of the following is characteristic of the way monopolistically competitive firms can differentiate the product?
answer
All of the answers represent product differentiation.
question
Choose the statement that is not true about the game theoretic model. The game theoretic model:
answer
may assume that players make decisions based on their own desires, disregarding other players' actions.
question
Which of the following statements is consistent with the kinked demand curve model in Figure 12.2?
answer
Rivals would match a decrease in price to P3.
question
Oligopolistic industries are characterized by:
answer
few sellers trying to avoid price competition.
question
Which of the following is not a characteristic of a monopolistically competitive market?
answer
Monopolistically competitive firms cannot achieve any degree of monopoly power.
question
Figure 12.2 represents the market for readers (iPad, Kindle, Sony Reader, Nook). If producers of readers are unable to collude, then according to the kinked demand curve model:
answer
if Apple raises the price of iPad, none of the other reader producers will raise the price.
question
Which of the following is not true in Figure 12.1?
answer
The firm is producing beyond its capacity.
question
Monopolistically competitive firms use advertising to:
answer
rotate the firm's demand curve clockwise.
question
In the long run, a monopolistically competitive market will:
answer
have the same costs and revenues on average.
question
According to the price leadership model:
answer
firms match the price leader's price.
Order an Essay Now & Get These Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
