Question 1

Tying is always profitable for a monopoly.

Accepted Answer

A) True 
 B)False

Question 2

Why are the actions of the firms in an oligopoly interdependent?

Accepted Answer

because there are on...

Question 3

As the number of firms in an oligopoly increases, the magnitude of the price effect increases.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following statements is correct?

Accepted Answer

A)  If duopolists successfully collude, then their combined output will be less than the output that would be observed if the market were a monopoly.
B)  The logic of self-interest decreases a duopoly's price below the monopoly price, and it pushes the duopolists to reach the competitive level of output.
C)  The logic of self-interest increases a duopoly's level of output above the monopoly level, and it pushes the duopolists to reach the competitive price.
D)  If duopolists successfully collude, then their combined output will be equal to the output that would be observed if the market were a monopoly.E) A) and B)
F) None of the above

Question 5

If all of the firms in an oligopoly successfully collude and form a cartel, then total profit for the cartel is equal to what it would be if the market were a monopoly.

Accepted Answer

A) True 
 B)False

Question 6

Assume that Samorola has entered into an enforceable resale price maintenance agreement with Trint and U-Mobile. Which of the following will always be true?

Accepted Answer

A)  The wholesale price of Samorolas will be different for Trint than it is for U-Mobile.
B)  U-Mobile will benefit from customers who go to Trint for information about different mobile phones.
C)  Trint will sell Samorolas at a lower price than U-Mobile.
D)  U-Mobile and Trint will always sell Samorolas for exactly the same price.E) C) and D)
F) B) and D)

Question 7

According to the Clayton Act,

Accepted Answer

A)  the government was able to incarcerate the CEO of a firm from illegal pricing arrangements.
B)  individuals can sue to recover damages from illegal cooperative agreements.
C)  competing executives cannot talk about fixing prices.
D)  if a person can prove that she was damaged by an illegal arrangements to restrain trade, that person can sue and recover ten times the damages she sustained.E) A) and C)
F) All of the above

Question 8

Some people consider the NCAA (National Collegiate Athletic Association) to be a __________ in the market for college athletics.

Accepted Answer

The answer of Some people consider the NCAA (National Collegiate...

Question 9

Suppose that Jamir and Haidy are duopolists in the music industry. In June, they agree to work together as a monopolist, charging the monopoly price for their music and producing the monopoly quantity of songs. By July, each singer is considering breaking the agreement. What would you expect to happen next?

Accepted Answer

A)  Jamir and Haidy will determine that it is in each singer's self-interest to maintain the agreement.
B)  Jamir and Haidy will each break the agreement.Both singers' profits will decrease.
C)  Jamir and Haidy will each break the agreement.Both singers' profits will increase.
D)  Jamir and Haidy will each break the agreement.The new equilibrium quantity of songs will increase, and the new equilibrium price also will increase.E) None of the above
F) A) and B)

Question 10

Table 17-7
Two companies, Wonka and Gekko, each decide whether to produce a good quality product or a poor quality product. In the figure, the dollar amounts are payoffs and they represent annual profits (in millions of dollars)  for the two companies.
 
-Refer to Table 17-7. The dominant strategy for Wonka is to

Accepted Answer

A)  produce a good quality product, and the dominant strategy for Gekko is to produce a good quality product.
B)  produce a good quality product, and the dominant strategy for Gekko is to produce a poor quality product.
C)  produce a poor quality product, and the dominant strategy for Gekko is to produce a good quality product.
D)  produce a poor quality product, and the dominant strategy for Gekko is to produce a poor quality product.E) A) and B)
F) A) and C)

Question 11

Explain the practice of tying and discuss why it is controversial.

Accepted Answer

Tying is the practice of bundling goods ...

Question 12

The notion of a tit-for-tat strategy applies to a prisoners' dilemma game that is played repeatedly, but it does not apply if the game is played only once.

Accepted Answer

A) True 
 B)False

Question 13

What effect does the number of firms in an oligopoly have on the characteristics of the market?

Accepted Answer

As the number of firms increas...

Question 14

The equilibrium quantity in markets characterized by oligopoly is

Accepted Answer

A)  higher than in monopoly markets and higher than in perfectly competitive markets.
B)  higher than in monopoly markets and lower than in perfectly competitive markets.
C)  lower than in monopoly markets and higher than in perfectly competitive markets.
D)  lower than in monopoly markets and lower than in perfectly competitive markets.E) B) and C)
F) A) and D)

Question 15

When prisoners' dilemma games are repeated over and over, sometimes the threat of penalty causes both parties to cooperate.

Accepted Answer

A) True 
 B)False

Question 16

If one firm left a duopoly market where the firms did not cooperate then

Accepted Answer

A)  price and quantity would rise.
B)  price would rise and quantity would fall.
C)  quantity would rise and price would fall.
D)  quantity and price would fall.E) C) and D)
F) B) and D)

Question 17

It is always the case that players in a prisoner's dilemma situation will choose the Nash Equilibrium.
​

Accepted Answer

A) True 
 B)False

Question 18

Table 17-4
Only two firms, JKL and XYZ, sell a particular product. The following table shows the demand curve for their product. Each firm has the same constant marginal cost of $8 and zero fixed cost.
​
​
   Price  (Dollars per unit)   Quantity Demanded  (Units)   Total Revenue  (Dollars)  2800265130241024022153302020400182545016304801435490124048010454508504006553304602402651300700\begin{array} { | c | c | c | } \hline \begin{array} { c } 	ext { Price } \	ext { (Dollars per unit)  }\end{array} & \begin{array} { c } 	ext { Quantity Demanded } \	ext { (Units)  }\end{array} & \begin{array} { c } 	ext { Total Revenue } \	ext { (Dollars)  }\end{array} \\hline 28 & 0 & 0 \\hline 26 & 5 & 130 \\hline 24 & 10 & 240 \\hline 22 & 15 & 330 \\hline 20 & 20 & 400 \\hline 18 & 25 & 450 \\hline 16 & 30 & 480 \\hline 14 & 35 & 490 \\hline 12 & 40 & 480 \\hline 10 & 45 & 450 \\hline 8 & 50 & 400 \\hline 6 & 55 & 330 \\hline 4 & 60 & 240 \\hline 2 & 65 & 130 \\hline 0 & 70 & 0 \\hline\end{array} Price  (Dollars per unit)  ​2826242220181614121086420​ Quantity Demanded  (Units)  ​0510152025303540455055606570​ Total Revenue  (Dollars)  ​01302403304004504804904804504003302401300​​  ​
-Refer to Table 17-4. If JKL and XYZ operate to jointly maximize profits, then what is the price?

Accepted Answer

A)  $22
B)  $20
C)  $18
D)  $16 E) C) and D)
F) B) and C)

Question 19

Oligopolies produce more when they collude then when they do not.

Accepted Answer

A) True 
 B)False

Question 20

A Nash Equilibrium is a stable outcome for an oligopoly market situation.
​

Accepted Answer

A) True 
 B)False

Exam 17: Oligopoly

The notion of a tit-for-tat strategy applies to a prisoners' dilemma game that is played repeatedly, but it does not apply if the game is played only once.

Correct Answer
verified

Explain the practice of tying and discuss why it is controversial.

Correct Answer
verified
Tying is the practice of bundling goods ...
View Answer

According to the Clayton Act,

Correct Answer
verified

Why are the actions of the firms in an oligopoly interdependent?

Correct Answer
verified
because there are on...
View Answer

Tying is always profitable for a monopoly.

Correct Answer
verified

It is always the case that players in a prisoner's dilemma situation will choose the Nash Equilibrium.

Correct Answer
verified

As the number of firms in an oligopoly increases, the magnitude of the price effect increases.

Correct Answer
verified

If one firm left a duopoly market where the firms did not cooperate then

Correct Answer
verified

Assume that Samorola has entered into an enforceable resale price maintenance agreement with Trint and U-Mobile. Which of the following will always be true?

Correct Answer
verified

Correct Answer
verified

Which of the following statements is correct?

Correct Answer
verified

Some people consider the NCAA (National Collegiate Athletic Association) to be a __________ in the market for college athletics.

Correct Answer
verified

If all of the firms in an oligopoly successfully collude and form a cartel, then total profit for the cartel is equal to what it would be if the market were a monopoly.

Correct Answer
verified

A Nash Equilibrium is a stable outcome for an oligopoly market situation.

Correct Answer
verified

The equilibrium quantity in markets characterized by oligopoly is

Correct Answer
verified

Oligopolies produce more when they collude then when they do not.

Correct Answer
verified

When prisoners' dilemma games are repeated over and over, sometimes the threat of penalty causes both parties to cooperate.

Correct Answer
verified

Correct Answer
verified

What effect does the number of firms in an oligopoly have on the characteristics of the market?

Correct Answer
verified
As the number of firms increas...
View Answer

Correct Answer
verified

Exam 17: Oligopoly

The notion of a tit-for-tat strategy applies to a prisoners' dilemma game that is played repeatedly, but it does not apply if the game is played only once.

Correct AnswerverifiedShow Answer

Explain the practice of tying and discuss why it is controversial.

Correct AnswerverifiedTying is the practice of bundling goods ...View AnswerShow Answer

According to the Clayton Act,

Correct AnswerverifiedShow Answer

Why are the actions of the firms in an oligopoly interdependent?

Correct Answerverifiedbecause there are on...View AnswerShow Answer

Tying is always profitable for a monopoly.

Correct AnswerverifiedShow Answer

It is always the case that players in a prisoner's dilemma situation will choose the Nash Equilibrium. ​

Correct AnswerverifiedShow Answer

As the number of firms in an oligopoly increases, the magnitude of the price effect increases.

Correct AnswerverifiedShow Answer

If one firm left a duopoly market where the firms did not cooperate then

Correct AnswerverifiedShow Answer

Assume that Samorola has entered into an enforceable resale price maintenance agreement with Trint and U-Mobile. Which of the following will always be true?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following statements is correct?

Correct AnswerverifiedShow Answer

Some people consider the NCAA (National Collegiate Athletic Association) to be a __________ in the market for college athletics.

Correct AnswerverifiedShow Answer

If all of the firms in an oligopoly successfully collude and form a cartel, then total profit for the cartel is equal to what it would be if the market were a monopoly.

Correct AnswerverifiedShow Answer

A Nash Equilibrium is a stable outcome for an oligopoly market situation. ​

Correct AnswerverifiedShow Answer

The equilibrium quantity in markets characterized by oligopoly is

Correct AnswerverifiedShow Answer

Oligopolies produce more when they collude then when they do not.

Correct AnswerverifiedShow Answer

When prisoners' dilemma games are repeated over and over, sometimes the threat of penalty causes both parties to cooperate.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

What effect does the number of firms in an oligopoly have on the characteristics of the market?

Correct AnswerverifiedAs the number of firms increas...View AnswerShow Answer

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified
Tying is the practice of bundling goods ...
View Answer

Correct Answer
verified

Correct Answer
verified
because there are on...
View Answer

Correct Answer
verified

It is always the case that players in a prisoner's dilemma situation will choose the Nash Equilibrium.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

A Nash Equilibrium is a stable outcome for an oligopoly market situation.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
As the number of firms increas...
View Answer

Correct Answer
verified