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Chapter 17 Graded: Oligopoly

mfloyd6 10 questions

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Questions in this quiz (10)

  1. 1If the two companies make their pricing decisions independently, then it is likely that QRS willImage for question 1
    1. Acharge a low price only if ABC charges a high price.
    2. Bcharge a low price only if ABC charges a low price.
    3. Ccharge a low price regardless of whether ABC charges a high price or a low price.
    4. DNone of the above are correct.
  2. 2Assume that trade negotiators meet to discuss trade policy between the United States and Farland. If neither party to the negotiation is able to trust the other party, thenImage for question 2
    1. Aeach should follow its dominant strategy.
    2. Beach should assume that the other will choose a strategy that optimizes total value of the trade relationship.
    3. C the Nash equilibrium will provide the largest possible gains to each party.
    4. DFarland negotiators should assume that United States negotiators will implement a policy that is in the mutual best interest of both countries.
  3. 3If both firms follow a dominant strategy, Firm B's profits (losses) will beImage for question 3
    1. A$-100m
    2. B$-24m
    3. C$-12m
    4. D$-40m
  4. 4At the Nash equilibrium, how much profit will Firm A earn?Image for question 4
    1. A$80,000
    2. B$120,000
    3. C$70,000
    4. D$90,000
  5. 5Which firms have a dominant strategy?Image for question 5
    1. AB but not A
    2. BA but not B
    3. CA and B
    4. DNeither A nor B
  6. 6Once a cartel is formed, the market is in effect served by
    1. Aa monopoly
    2. Bimperfect competition.
    3. Can oligopoly.
    4. Dmonopolistic competition.
  7. 7A group of firms that act in unison to maximize collective profits is called a
    1. Acartel.
    2. Bmonopoly
    3. Cmonopolistically competitive industry.
    4. DNash equilibrium market.
  8. 8An agreement among firms regarding price and/or production levels is called
    1. Aa free-trade arrangement.
    2. B a Nash agreement.
    3. Ccollusion
    4. Dan antitrust market.
  9. 9Brian and Matt own the only two bicycle repair shops in town. Each must choose between a low price for repair work and a high price. The annual economic profit from each strategy is indicated in the table. The profits are shown as (Matt, Brian) in each cell.Image for question 9
    1. AMatt's dominant strategy is to charge a low price
    2. BMatt's dominant strategy is to charge a high price.
    3. CBrian's dominant strategy is to charge a high price.
    4. DThe dominant strategy for both Brian and Matt is to charge a low price.
  10. 10In the prisoners' dilemma,
    1. Athe prisoners easily collude in order to achieve the best possible payoff for both.
    2. Bwhen each player chooses his dominant strategy the players achieve the best joint outcome
    3. Cwhen each player chooses his dominant strategy the players reach a Nash equilibrium
    4. Donly one player has a dominant strategy.

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Description
Quiz on Chapter 17 Graded: Oligopoly, created by mfloyd6 on 14/04/2015.
Author
mfloyd6
Language
English
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