Oligopoly

there are two producers of a product.

A duopoly is a market in which

No, because the dominant strategy of the best-prepared students is to answer the last question.

After teaching a class on game theory, the instructor announces that if every student skips the last question on the next exam, everyone will receive full credit for that question. However, if one or more students answer the last question, all responses will be graded and those who skip the question will get a zero Will the entire class skip the last question if there is no chance for classmates to discuss the situation before taking the exam?

Lee should always choose Don't Clean.

Dirk and Lee are two college roommates who would both like to have a clean room, but neither enjoys cleaning. The roommates must each make a decision to either clean or not clean the dorm room's common space. The payoff table for this situation is provided below, where the higher a player's payoff number, the better off that player is.

Firm A's dominant strategy is to break the agreement, and Firm B's dominant strategy is to break the agreement

Given the matrix above, which of the following is correct?

for both restaurants to abide by the cartel's agreement.

Suppose there are two breakfast restaurants in your college town, Waffle Kingdom and Flip's Flapjacks, and they decide to operate collusively as a cartel. If both restaurants abide by the cartel's agreement, then each will earn $100,000 in profit. If both restaurants cheat on the cartel's agreement, then each will earn $25,000 in profit. If one restaurant cheats and the other abides by the agreement, then the cheater will earn a profit of $150,000 while the firm that abides will have a loss of $12,500. The most profitable combined outcome for the two restaurants would be

FEEDBACK: If there was proof that both firms signed an agreement to engage in certain illegal behavior, both firms could be prosecuted. Neither the court system nor economists have a simple rule that helps to determine when a firm steps over the line. Predatory pricing can look and feel like spirited competition. Moreover, the concern is not the competitive aspect or lower prices. but the effect on the market when all rivals fail. To prove that predatory pricing has occurred, the courts need evidence that the firm's prices increased significantly after its rivals failed.

Wallmart is accused of predatory pricing by Doormart. Wallmart could defend itself against this accusation. Which of the following would not be one of their arguments?

passenger airlines

Which of the following markets are oligopolistic? Select all that apply.

automobile industry

Which of the following sets of firms is best described as an oligopoly?

FEEDBACK: Oligopoly falls somewhere between the competitive market and monopoly outcomes. Output is likely to be higher than under monopoly and lower than within a competitive market. The higher output makes oligopoly prices generally lower than monopoly prices, but higher than those found in competitive markets.

Which of the following statements is true?

bad because because prices are too high and output is too low

With regards to social welfare, oligopolists forming a cooperative alliance is:

You both work hard.

You are assigned a two-student project. Assume that you and your partner are both interested in maximizing your grade, but you are both very busy and get more happiness if you can get a good grade with less work. If you and your partner are required to work together on a number of projects throughout the semester, what other possible equilibrium might you be able to sustain?

you both work less hard.

You are assigned a two-student project. Assume that you and your partner are both interested in maximizing your grade, but you are both very busy and get more happiness if you can get a good grade with less work. Your dominant strategy is