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Question;21);In a prisoners' dilemma game, in the Nash equilibrium;A);neither player gets his or her best outcome.;B);both players get their best outcome.;C);one player gets his or her best outcome and the other player does not.;D);collusion would not alter the outcome.;E);Either answer A or C might be correct depending on whether the players;communicate;with;each other or do not communicate with each other.;21);22);In the prisoners' dilemma, each player is ________ regardless of the other;player's actions.;A);better off confessing;B);forced to confess;C);better off denying;D);forced to deny;E);going to go free;22);23);In an oligopoly, output is;A);greater than the output in perfect competition.;B);somewhere between the output in monopoly and that in perfect competition;outcomes.;C);in all circumstances the same as the output in perfect competition.;D);less than the output in monopoly.;E);in all circumstances the same as the output in monopoly.;23);24);Which of the following is true? In the above figure, if the market is;A);a monopoly, output will beQ3 and price will beP3.;B);perfect competition, output will beQ3 and price will beP3.;C);perfect competition, output will beQ1 and price will beP1.;D);a monopoly, output will beQ1 and price will beP3.;E);perfect competition, output will beQ2 and price will beP2.;24);5;25);In the above figure, the output of an oligopoly will range between;A)Q2 andQ3.;B);0 andQ1.;C)Q1 andQ2.;D)Q1 andQ3.;E);0 andQ2.;25);26);A Nash equilibrium in the duopoly game;A);means that one player has greater market power.;B);will always lead to equilibrium in which the firms' total profit is the;largest.;C);can occur only if firms cooperate with each other.;D);means that a firm must be able to determine its actionsandthe actions of its competitor.;E);occurs when each player takes the best possible action regardless of the;strategy chosen by;other;firms.;26);27);The major dilemma facing Boeing and Airbus is the;A);fact that neither will respond to the behavior of the other.;B);fact that if each firm separately tries to maximize its profit, it might wind;up with less;profit;that otherwise.;C);fact that when they collude to maximize their profit, the other firm's profit;might be larger;than;its profit.;D);certainty surrounding the reaction of each firm to the behavior of the other;firm.;E);competition from other firms that drives their economic profit to zero.;27);6;28);The above figure shows the market demand curve for long-distance telephone calls. Suppose;the;marginal cost of a long-distance;telephone call is 2? a minute for a call no matter how many;minutes;of calls are made and there are 3 firms in the industry. If the firms in the;industry;operate;as perfect competitors, there are ________ minutes of calls made per hour.;A);between 0 and 3 million;B);more than 3 million and less than or equal to 5 million;C);more than 5 million and less than or equal to 7 million;D);more than 9 million;E);more than 7 million and less than or equal to 9 million;28);7;29);The figure above shows the market demand curve and theATCcurve for a firm. If all firms in;the;market have the sameATCcurve;the lowest price at which a firm could stay in business in;the;long run is ________ per unit and the quantity demanded in the market at that;price is;units per hour.;A);\$20, 2,000;B);\$10, 4,000;C);\$20, 8,000;D);\$10, 8,000;E);\$20, 4,000;29);30);The figure above shows the market demand curve and theATCcurve for a firm. If all firms in;the;market have the sameATCcurve;the efficient scale for one firm is ________ units per hour.;A);2,000;B);4,000;C);8,000;D);10,000;E);more than 10,000;30);31);Which of the following is correct?;A);In the long run, a firm in monopolistic competition earns zero economic profit;and its;price;is equal to the minimum average total cost.;B);In the long run, a firm in monopolistic competition can earn an economic profit;because of;product;differentiation.;C);A firm in perfect competition operates at maximum average total cost in the;long run.;D);In the long run, a firm in monopolistic competition maximizes its profit at a;point where;price;is equal to average total cost but the average total cost is not minimized.;E);A firm in monopolistic competition does not have excess capacity in the long run.;31);8;32);A cartel is most likely to occur in;A);perfect competition as firms compete by reducing cost.;B);oligopoly as firms compete to lower price and increase their own profits.;C);monopolistic competition where firms collude to increase profits.;D);monopoly because it faces no competition.;E);oligopoly as firms act together to raise prices and increase profits.;32);33);When firms in monopolistic competition are making an economic profit, firms;will;A);enter the industry, and demand will decrease for the original firms.;B);exit the industry, and demand will increase for the firms that remain.;C);enter the industry and then will exit the industry.;D);enter the industry, and demand will increase for the original firms.;E);exit the industry, and demand will decrease for the firms that remain.;33);34);Herb's Inc. has a large share of its market and is tempted to collude with the;few firms that are in;its;market. Herb's operates in;A);a perfectly competitive market.;B);collusively protected market.;C);a monopoly market.;D);a monopolistically competitive market.;E);an oligopoly.;34);35);A cartel is;A);a market structure with a large number of small firms.;B);a market with only two firms.;C);a group of firms acting together to raise price, decrease output, and increase;economic;profit.;D);a market structure with a small number of large firms.;E);another name for an oligopoly.;35);36);For a firm in monopolistic competition, the efficient scale is the amount of;output at which;is a minimum.;A);marginal cost;B);fixed cost;C);average total cost;D);average variable cost;E);average fixed cost;36);37);A firm in monopolistic competition ________ influence its price and;influence the;market;average price.;A);cannot, cannot;B);can, only in the short run can;C);can, cannot;D);cannot, can;E);can, can;37);9;38);At a long-run;equilibrium in monopolistic competition, price equals;A);marginal cost but not marginal revenue.;B);average total cost.;C);marginal revenue and marginal cost.;D);marginal revenue but not marginal cost.;E);zero.;38);39);In monopolistic competition there are ________ barriers to entry, so therefore;in the long run;economic;profit ________.;A);no, is substantial;B);many, equals zero;C);no, equals zero;D);many, is substantial;E);many, might be earned depending on the degree of product differentiation;39);40);The major difference between monopolistic competition and monopoly is;A);monopoly is a price setter and a firm in monopolistic competition is a price;taker.;B);how the quantity of output is determined.;C);only a monopoly can earn an economic profit in the long run.;D);only a firm in monopolistic competition can earn an economic profit in the;short run.;E);only firms in monopolistic competition are protected by barriers to entry.;40)

Paper#57939 | Written in 18-Jul-2015

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