Microeconomics Exam 3 Chang Mississippi State

a side-effect of an activity that affects bystanders whose interests are not taken into account.

. An externality is defined as: a. the effect of an activity undertaken outside a building rather than inside a building. b. an effect of market activity that impacts the opposite side of the market from the side whose decision caused the effect. c. a side-effect of an activity that affects bystanders whose interests are not taken into account. d. the impact of an activity on buyers and sellers in the market where the activity takes place.

human capital

. The accumulated knowledge and skills that make a worker more productive are known as: a. human capital. b. labor enhancement. c. labor factoring. d. efficiency investment.

demand curve

. The marginal private benefit curve is also the: a. supply curve. b. marginal external benefit curve minus the marginal social benefit curve. c. demand curve. d. marginal personal benefit curve.

marginal private

. The supply curve of a firm is also its _____ cost curve. a. average b. social c. marginal private d. marginal external

D

. Which graph shows the scenario where the income effect dominates labor supply decisions only at high wages? a. Graph A b. Graph B c. Graph C d. Graph D

a corrective

4. A tax designed to induce people to take account of the negative externalities that they cause is referred to as _____ tax. a. an externality b. an open offset c. a corrective d. a compensatory

C. punish rivals who do not cooperate.

A Grim Trigger strategy is to: A. aggressively announce actions in advance. B. take extreme actions whenever profits fall. C. punish rivals who do not cooperate. D. defect on all agreements.

A. making a good choice requires that you anticipate what others will do.

A basic logic that applies to all strategic interactions is: A. making a good choice requires that you anticipate what others will do. B. risk must be eliminated. C. action should not be taken until there is a clear best choice. D. games should be avoided, so that decisions can be based on facts.

are a small number of sellers with considerable market power.

A characteristic of oligopoly that is not present in any other market structure is that there a. is only one seller and that seller has a high level of market power. b. are many sellers and each produces its own version of the product. c. are a small number of sellers with considerable market power. d. are many sellers that produce identical products.

.c. difference in wages that offsets the desirable or undesirable aspects of a job.

A compensating differential is an: a. adjustment to wages that compensates for lost work due to the use of robotics. b. adjustment to work hours that allows low-wage employees to earn more .c. difference in wages that offsets the desirable or undesirable aspects of a job. d. difference in wages that adjusts for differences in worker productivity.

A. nonrival

A good is characterized as _____ when one person's use of the good does not reduce another person's ability to use the same unit of the good. A. nonrival B. nonexcludable C. free D. shareable

outcomes; of one player's possible outcomes; each of the other player's possible outcomes

A payoff table lists all possible _____, with a row for each _____ and a column for _____. a. outcomes; of one player's possible outcomes; each of the other player's possible outcomes b. costs; fixed cost; each variable cost c. rivals; possible rival; each outcome resulting from competing against each rival d. outcomes; possible negative outcome; each possible positive outcome

an action taken to credibly convey information that is hard for someone else to verify

A signal is: a. an action taken to credibly convey information that is hard for someone else to verify. b. advance notice of an action that will be taken in the future. c. a price tag. d. an indicator of the equilibrium wage and quantity in a market.

the increase in worker effort and reduced turnover cover the cost of the higher wage.

An efficiency wage improves efficiency when: a. the increase in worker effort and reduced turnover cover the cost of the higher wage. b. it is structured so that only the most productive workers receive a higher wage .c. capital costs are reduced enough to cover wage costs. d. improved technology accompanies the worker training.

a reward; an incentive

An efficiency wage is NOT _____ but rather _____.

the marginal benefit exceeds the marginal cost.

An employer should hire one more worker if a. the total benefit exceeds the total cost. b. the marginal cost is falling. c. the marginal benefit exceeds the marginal cost. d. demand is rising.

marginal revenue product curve.

An employer's labor demand curve is equal to the a. marginal revenue product curve. b. marginal product curve. c. marginal revenue curve. d. rational product curve.

Nash equilibrium.

An equilibrium in which the choice that each player makes is a best response to the choices other players are making is the definition of a: a. market equilibrium. b. Coase theorem solution. c. Nash equilibrium. d. strategic equilibrium.

C. a side-effect of an activity that affects bystanders whose interests are not taken into account.

An externality is defined as: A. an effect of market activity that impacts the opposite side of the market from the side whose decision caused the effect. B. the effect of an activity undertaken outside a building rather than inside a building. C. a side-effect of an activity that affects bystanders whose interests are not taken into account. D. the impact of an activity on buyers and sellers in the market where the activity takes place.

B. quantity discount.

Bayside Shoe Shop offers a BOGO (buy one, get one) special where customers can buy one pair at full price and get another pair at half-price. This form of price discrimination is referred to as A. group pricing. B. quantity discount. C. fluctuating prices. D. bad service.

D. overproduce

By contrast with a market that produces the socially optimal output, a market with negative externalities will: A. produce the correct output. B. underproduce. C. produce no output. D. overproduce.

the difference in wages required to offset the undesirable (or desirable) attributes of a job

Compensating differential

B. $7; $6,000

Devin tries to put himself in Gizelle's place. He concludes that if he (Devin) charges $8, then Gizelle will charge _____ to earn a profit of _____. A. $6; $3,000 B. $7; $6,000 C. $8; $4,000 D. $9; $5,000

B. their own costs and benefits; the effects of their actions on others

Externalities tend to occur because decision makers consider _____ and do NOT consider _____. A. their own income as limitless; their income as limited B. their own costs and benefits; the effects of their actions on others C. their own needs as most important; the fact that others also have needs D. the welfare of others; their own welfare

D. the science of making good decisions in situations involving strategic interactions.

Game theory is: A. a view on the development of children's games and toys. B. a view on decision making when clear paths to optimum outcomes are known. C. the analysis of market forces when there is role reversal for buyers and sellers. D. the science of making good decisions in situations involving strategic interactions.

C. They are price-sensitive.

Hassan is a student who received a coupon to buy pizza from Pizza House at $4 off the regular price. Students at Hassan's school seem to receive the coupons frequently. Which of the following is an assumption that the owners of Pizza House are making about students at Hassan's school? A. Their demand for pizza is highly inelastic. B. Their marginal benefit from pizza is very high. C. They are price-sensitive. D. They have a high reservation price for pizza.

4; 3

How many workers would the firm hire if it were required to pay a wage of $14/h? If the Federal minimum wage were suddenly increased to $20/h, how many workers would the firm then employ?

One of the reasons why wages differ is because of the accumulated knowledge and skills that make a worker more productive.

Human Capital

the substitution effect; the income effect the income effect; the substitution effect

In Graph 1, __________ dominates _____________. In Graph 2, _________ dominates _____________.

supply; demand

In a labor market, workers _____ labor, and employers _____ labor. a. supply; demand b. demand; supply c. hire; use d. use; hire

The new seller would have much higher costs than the existing large seller in the market.

In a natural monopoly, what deters new sellers from entering the market? a. The existing seller has higher costs and profits than what the new entrant will face. b. Marginal revenue will be higher for new entrants, making profits less probable. c. The new seller would have much higher costs than the existing large seller in the market. d. The existing monopolist has long-term contracts with buyers.

B. Oligopoly

In which market structure do the actions of a rival have a significant impact on your operations? A. Monopoly B. Oligopoly C. Perfect competition D. Monopolistic competition

change in revenue from selling an extra item

Marginal revenue product is the a. change in revenue from selling an extra item. b. marginal revenue from hiring an additional worker. c. extra product produced from spending marginal revenue on inputs. d. change in revenue from the total production.

D. The drugs would not have been developed.

Patents on drugs to treat AIDS were removed in South Africa. How would the market for these drugs have been different if there had never been patents on drugs? A. Larger quantities of the drugs would have been produced. B. The drug prices would have been even higher. C. The drug prices would have been lower from the start. D. The drugs would not have been developed.

A. the product cannot be resold.

Price discrimination can be successful only if A. the product cannot be resold. B. the company lacks market power. C. the market is highly competitive. D. there are many sellers.

your business has market power, you can prevent resale, you can target right price to right costumer

Price discrimination is only feasible if

A. a more efficient output

Price discrimination leads to _____ than a one-price system. A. a more efficient output B. fewer buyers C. a lower average cost D. a lower average price

price discrimination.

Selling the same good at different prices to different buyers is a. price differentiation. b. price discrimination. c. revenue differentiation d. alternative revenue collection.

substitution effect

The _________________ measures how people respond to a change in relative prices when the wage rises. a. substitution effect b. income effect c. opportunity cost d. marginal benefit

the supply of electricians will decrease, resulting in a higher wage and lower quantity of labor

The government increases the training requirements to obtain an electrician's license. What impact will this have in the labor market for electricians?

A. 8

The graph shows the marginal social cost, supply, and demand curves in the hand sanitizer market. At what quantity could the government set a quota to control this externality? A. 8 B. 2 C. 4 D. 12

Derived

The labor demand is a/an _____________ demand a. Modified b. Imputed c. Derived d. Inferred

D. extra benefit enjoyed by the buyer of one extra unit of a good or service.

The marginal private benefit is the: A. extra benefit that goes to bystanders for each additional unit of a good consumed by others. B. addition to the satisfaction a buyer receives from the total quantity of a product consumed. C. total extra benefit society gains from the consumption of an extra unit of a good. D. extra benefit enjoyed by the buyer of one extra unit of a good or service.

marginal social

The marginal private benefit plus the marginal external benefit equals the ____ benefit. a. total public b. total externality c. marginal social d. marginal public

extra production that occurs from hiring an extra worker.

The marginal product of labor is the a. amount of extra worker time it takes to produce one extra unit of output. b. change in output from the slowest worker to the most productive worker. c. extra output produced by all the firm's employees. d. extra production that occurs from hiring an extra worker.

D. marginal revenue product.

The marginal revenue from hiring an additional worker is known as A. marginal worker revenue. B. labor marginal product. C. labor marginal revenue. D. marginal revenue product.

MPL × P.

The marginal revenue product of labor is equal to: a. MPL + P. b. MR × Wage. c. MR + Wage. d. MPL × P.

B. socially optimal

The outcome that is most efficient for society as a whole — including the interests of buyers, sellers, and bystanders — is the _____ outcome. A. externally optimal B. socially optimal C. social benefit maximizing D. public optimal

overproduction

The problem associated with a negative externality

impact wages

There is evidence that, despite antidiscrimination laws, discrimination _____ in labor markets. a. impacts wages b. exists but has no impact c. benefits groups that are discriminated against d. accounts for all differences in wages across groups of workers

C. would be a natural monopoly, and the good or service is considered essential.

To avoid harm to society, the government often becomes the supplier of a good or service when the respective market A. has been engaging in illegal activities that the government seeks to eliminate. B. has high profit, and the government can use those to replace tax revenue. C. would be a natural monopoly, and the good or service is considered essential. D. would be competitive enough to cause surpluses to develop.

D. $3,000; $3,000

Use the check mark method to determine which cell contains a Nash equilibrium. Under a Nash equilibrium, Hui Er earns profits of _____, and Tasha earns profits of _____. A. $5,000; $5,000 B. $6,000; $700 C. $700; $6,000 D. $3,000; $3,000

D. a monopolistically competitive market.

Walmart has a large aisle that displays many different kinds of toothpastes. This observation indicates that the toothpaste market is A. a monopoly. B. a perfectly competitive market. C. an oligopoly. D. a monopolistically competitive market.

A. Agreements between sellers to increase their market power

What is collusion? A. Agreements between sellers to increase their market power B. A merger of two sellers C. Regulatory restrictions on the entry of new sellers into an industry D. Cooperation between sellers to increase the level of competition

not a price-taker

When a company has market power, it is _____ in its market. a. one of many small companies b. not a price-taker c. a producer of nondifferentiated products d. not able to impact the market equilibrium price

public good

When a good is nonrival and nonexcludable, the good is referred to as: a. a free-ride benefit good. b. an external good. c. a private good. d. a public good.

gains market power.

When a seller is able to differentiate its product successfully, the seller a. has a reduction in costs of production. b. takes its market closer to perfect competition. c. loses market share. d. gains market power.

working or leisure.

When making labor supply decisions, your options are a. working or doing housework. b. working, shopping, or relaxing. c. working or leisure. d. working, sleeping, or leisure.

a larger output; a greater range of prices

When price discrimination is practiced, a company sells _____ and charges _____ compared to what it would do without practicing price discrimination. a. a larger output; a greater range of prices b. the same output; a greater range of prices c. a smaller output; higher prices d. a higher output; higher prices

is subject to the free-rider problem.

When someone can enjoy the benefits of a good without bearing the cost, the good: a. is subject to the free-rider problem. b. is excludable and rival. c. is a nonmarket good. d. is attractive to manufacturers.

only those who overcome the obstacle that the seller specifies will get a lower price.

When the hurdle method is used to price a product across buyers, a. only those buyers who want it can buy the product. b. they can buy different versions of the product with more advanced versions costing more. c. the seller prices the product based on the amount of difficulty faced in producing it. d. only those who overcome the obstacle that the seller specifies will get a lower price.

C. Graph A

Which graph shows the scenario where the substitution effect dominates labor supply decisions? A. Graph C B. Graph D C. Graph A D. Graph B

C. Assume that others will defer to your action.

Which of the following is NOT one of the four steps for making good strategic decisions? A. Think about the "what ifs" separately. B. Consider all the possible outcomes. C. Assume that others will defer to your action. D. Play your best response.

C. There is only one seller.

Which of the following is a characteristic of monopoly that is not present in other market structures? A. There are many buyers. B. The product is identical across all sellers. C. There is only one seller. D. Sellers are price-takers.

Market power allows a seller to control the market demand, and that allows him to set price.

Why is market power necessary for price discrimination? a. Market power increases competitive pressures, which facilitates discriminatory pricing. b. When a seller has market power, his product cannot be resold. c. Market power allows a seller to control the market demand, and that allows him to set price. d. Without market power, a seller would lose customers if he tried to charge a higher price.

smaller; more

With a _____ number of sellers in a market, _____ market power tends to exist in the market. a. smaller; more b. smaller; less consistent c. greater; more d. greater; less consistent

a compensating differential.

Workers on the night shift at a factory earn more per hour than workers on the day shift, although their human capital and productivity are the same. This is an example of: a. discrimination based on time preferences. b. irrational decision making by an employer. c. a compensating differential. d. an efficiency wage.

you should advise cokes CEO to keep advertising no matter what Pepsi chooses

coke and Pepsi discussed in class

the difference in wages required to offset the undesirable (or desirable) attributes of a job

compensating differentials

a higher wage paid to encourage greater worker productivity by increasing worker effort and reducing work turnover

efficiency wages

the study of how people behave in strategic situations

game theory

price discrimination by charging different prices to different groups of people.

group pricing

marginal product of labor X price of the output you sell

how to calculate MRP

One of the reasons why wages differ is because of the accumulated knowledge and skills that make a worker more productive. Productivity plays a key role in how much you get paid

human capital

offers lower prices only to those buyers who are willing to overcome some hurdles or obstacles.

hurdle method

The more you can differentiate your product the more market power you have, The more competitors you have the less market power you have

imperfectly competitive market

measures how people's choices change when they have more income.

income effect

government regulations, licensing laws, unions and workers, monopsony,

institutional factors that explain why wages vary

derived demand

labor demand is a

as wage of stylist fall, salons will hire more stylist

labor downward curve

it means that people cannot easily be excluded from using it.

non-excludable

the person's enjoyment or use of it does not subtract from another person's enjoyment or use.

non-rivalrous

a market with only a handful of large sellers.

oligopoly

a good that is non-excludable and non-rivalrous.

public good

the maximum price a customer will pay for a product. (it is equal to their marginal benefit)

reservation price

can solve externality

side payment

is why people work longer hours when their wage rises, and so it leads to an upward sloping individual labor supply curve

substation effect

Let's say Mr. Chang and Mrs. Park have each been arrested for some minor crime. The police think they committed more serious crime but they don't enough evidence to convict them. They need confessions. If they both stay silent (cooperate) they each spend 1 year in prison.If one betrays and the other stays silent, then the betrayer goes free and the silent spends 3 years in prison. If they both betray, then it is 2 years each.

the prisoners dilemma discussed in class

group pricing and hurdle method

two ways you can use to target the right prices to the right customers

patents grant, anticollusion laws

ways to ensure competition

corrective taxes and subsidies, quota

ways to solve externality problems

Forces of supply and demand

what determines the price of a haircut

supply and demand

what determines the wage paid to the hair stylist

Externality

what is one reason for market failures

A. a check mark is put next to each player's best response, and there is a cell with a check mark for each player.

A Nash equilibrium can be identified on a payoff table when: A. a check mark is put next to each player's best response, and there is a cell with a check mark for each player. B. one cell contains the highest gain for each player, although it may not be the player's best response. C. a check mark is put next to each player's best response, and there is a cell with no check marks in it. D. each player has an equilibrium that is opposite that of the other player, so they are not in conflict.

A. someone can enjoy the benefits of the good without bearing the costs.

A good has a free-rider problem when: A. someone can enjoy the benefits of the good without bearing the costs. B. any seller provides it for free as a special promotion. C. it can be transported at no cost to the consumer, with sellers bearing all transportation costs. D. it has no negative externalities but only positive externalities.

A. a monopolistically competitive market.

A market with many small sellers and a high level of product differentiation is known as A. a monopolistically competitive market. B. an oligopoly. C. a perfectly competitive market. D. a monopoly.

A. reducing; the price is above its marginal cost

A price-discriminating company can attract more customers by _____ price, as long as _____. A. reducing; the price is above its marginal cost B. raising; new customers are convinced to pay the price C. raising; the price is above marginal benefit and below marginal cost

D. higher the buyers' reservation price will be.

A useful rule of thumb is that the higher the marginal benefit a consumer gains from a product, the A. lower the consumer's demand for the product will be. B. more the consumer will seek substitutes for the product. C. more price-sensitive the consumer will be. D. higher the buyers' reservation price will be.

B. Yes, it was a good move because it added more to revenue than to cost.

Alena manages a small theme park. She hires one more custodian at $450 per week, and her park is cleaner and more attractive. As a result of this improvement, ticket sales rise by 40 tickets per week. Tickets sell for $12. Use the Rational Rule for Employers to determine if hiring the extra custodian was a good move. A. Yes, it was a good move because the ticket sales rose more than price. B. Yes, it was a good move because it added more to revenue than to cost. C. No, it was a bad move because it added more to cost than revenue. D. No, it was a bad move because price did not rise as much as ticket sales.

B. a payoff table

What is this kind of table called? A. an outcome matrix B. a payoff table C. a game matrix D. an interaction table

D. not a price-taker

When a company has market power, it is _____ in its market. A. a producer of nondifferentiated products B. not able to impact the market equilibrium price C. one of many small companies D. not a price-taker

B. the hurdle method; reservation price

When a seller offers lower prices to those buyers who are willing to overcome some obstacle to get it, the seller is using _____ to get buyers to reveal their _____. A. the hurdle method; marginal cost B. the hurdle method; reservation price C. impediment pricing; marginal benefit D. segment blocking; marginal benefit

D. make agreements not to compete with each other and, typically, to charge high prices.

When players in a game collude, they: A. act independently to try to eliminate other players from the game. B. choose to avoid any outcomes that harm their rival. C. change their products, so that they are in different markets and not competing with each other. D. make agreements not to compete with each other and, typically, to charge high prices.

occurs when people are treated differently based on characteristics like their gender, race, ethnicity, sexual orientation, religion, disability, social class, or other factors.

labor market discrimination

work longer hours

labor supply curve upward

wage and MB of another hour of leisure

labor supply depends on two factors

So, choosing the number of hours you work is equivalent to choosing your hours of leisure. · This is why economists describe labor supply as being about the choice between _____Labor______ and _____Leisure______.

labor-leisure relationship

cost imposed by bystanders, ex cost of pollution

marginal external costs

cost paid by the seller for raw materials, labor

marginal private costs

the extra output that occurs from hiring an extra worker

marginal product of labor

Mpc +mec

marginal social cost

marginal external costs

mec

a market with many businesses competing, each selling similar but differentiated products.

monopolistic competition

a market structure characterized by a single seller.

monopoly

an activity whose side effects harm bystanders whose interests are not taken into account. Negative externalities impost costs on others.

what is negative externality

an activity whose side effects benefit bystanders

what is positive externality

people often make decisions without taking full account of the costs that their choices impose on others.

why does negative externality create problems

they still lead to market failure because people typically make decisions without taking full account of the positive effects of our choices on bystanders

why does positive externality create problems

A. $4; $4

If Jose charges $8, Maria should charge _____. If Jose charges $4, Maria should charge _____. A. $4; $4 B. $4; $8 C. $8; $4 D. $8; $8

D. wage; hours of labor

In a labor market graph, _____ is measured on the vertical axis, and _____ is measured on the horizontal axis. A. hours of labor; wage B. product price; number of workers C. number of workers; product price D. wage; hours of labor

C. they would not be able to hire anyone.

In a perfectly competitive labor market, employers will not pay less than the market wage because at a wage below the equilibrium A. there would be a surplus of workers. B. they would be inundated with excess workers. C. they would not be able to hire anyone. D. the equilibrium wage would rise.

marginal private cost

MPC

Marginal Revenue Product

MRP

marginal product of labor X price of the output you sell

Marginal revenue product

A. Marta has little understanding of how much each customer values her product.

Marta owns a food truck. Which of the following would limit Marta's ability to price discriminate? A. Marta has little understanding of how much each customer values her product. B. Marta has considerable market power because she is the only seller in town of of that kind of food. C. Marta's product is good only if it is consumed immediately, making it difficult to store for resale.

marginal social cost

Msc

an equilibrium in which the choice that each player makes is a best response to the choices other players are making.

Nash equilibrium

D. reservation price

Selling alternative versions of a product at different prices is a way to identify the _____ of customers and charge them different prices. A. size of the population B. observable differences C. marginal cost D. reservation price

· the outcome that is most efficient for society as a whole, including the interests of buyers, sellers, and bystanders.

Socially optimal outcome:

C. the wage equals the marginal revenue product of the last worker hired.

The Rational Rule for Employers implies that they keep hiring until A. the wage equals marginal product. B. revenue equals cost. C. the wage equals the marginal revenue product of the last worker hired. D. marginal product equals marginal revenue.

D. the marginal social benefit exceeds the marginal social cost.

The Rational Rule for Society is that society should produce another unit of a good if: A. the total social benefit exceeds the total social cost. B. gains to the producer exceed losses to the producer. C. the marginal private benefit exceeds the marginal private cost. D. the marginal social benefit exceeds the marginal social cost.

B. if we know the marginal social cost, we can set the tax so that price is equal to the optimal price. As a result, the optimal quantity will be achieved.

Any outcome that can be achieved by taxing can also be accomplished by establishing a quota. This is because A. if we know the marginal social cost, we can set the optimal quantity equal to the optimal price. If we know the optimal quantity, we can set a quota equal to the optimal price. B. if we know the marginal social cost, we can set the tax so that price is equal to the optimal price. As a result, the optimal quantity will be achieved. C. If we know the optimal quantity, we can set a quota and the market will find the optimal price.if we know the optimal quantity, cap and trade can be used to set the price. If we know the marginal social cost, a tax can be used to set the quantity. D. knowing the marginal social cost allows companies to know how much to increase their prices and make more profits. This is better for the economy as a whole because then companies can create more jobs. Cap and trade restricts quantity, which lowers profits.

A. "Ban the box" laws not allowing employers to ask potential employees whether or not they have been in jail is increasing discrimination against Black men, particularly those without a college degree. B. Statistical discrimination occurs when employers discriminate against job candidates based on an irrelevant but observable characteristic which correlates to an unmeasurable but relevant characteristic.

Which of the following are true of statistical discrimination? There may be more than one correct answer. A. "Ban the box" laws not allowing employers to ask potential employees whether or not they have been in jail is increasing discrimination against Black men, particularly those without a college degree. B. Statistical discrimination occurs when employers discriminate against job candidates based on an irrelevant but observable characteristic which correlates to an unmeasurable but relevant characteristic. C. Statistical discrimination occurs when firms base hiring decisions on which candidate will improve the firm's diversity statistics. D. Some employers run complex statistical analysis of candidates' resumes before deciding who to interview for a position.

D. Most passengers traveling on an airplane pay different prices for their tickets.

Which of the following is an example of a company practicing price discrimination? A. The average price of a haircut is $20 in Dayton and $30 in Cincinnati. B. Johann's bakery charges $2 for a cookie, and Bella's bakery charges $3 for an identical cookie. C. A restaurant charges different prices for fountain drinks based on their size. D. Most passengers traveling on an airplane pay different prices for their tickets.

B. No player can do better by unilaterally changing his or her choice.

Which of the following statements regarding a Nash equilibrium is TRUE? A. All players choose their overall best response without regard to the other player's likely choice. B. No player can do better by unilaterally changing his or her choice. C. Each player's expectation of the other player's choice is often incorrect. D. Cooperation between players could not improve the outcome.

B. a siren tornado warning system

Which of the following would be both nonrival and nonexcludable? A. an immunization B. a siren tornado warning system C. a museum D. a road

B. $4,000; $3,500

With no cooperation, the Nash equilibrium yields Bella a profit of _____ and Martin a profit of _____. A. $1,000; $5,500 B. $4,000; $3,500 C. $5,000; $5,000 D. $6,000; $1,000