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Micro Ch. 17 Oligopoly Flashcards | StudBud

Explore/Micro Ch. 17 Oligopoly

Micro Ch. 17 Oligopoly

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Questions 7

Answers

1
An agreement among firms regarding price and/or production levels is called
collusion.
an antitrust market.
a Nash agreement.
a free-trade arrangement.
2
As the number of firms in an oligopoly increases, the
price effect exceeds the output effect.
price approaches marginal cost, quantity approaches socially efficient lvl
individual firms’ profits increase.
price and quantity approach the monopoly levels.
3
In the prisoners' dilemma game, self-interest leads
to an outcome that is not particularly good for either prisoner.
all of the above are correct.
each prisoner to confess.
to breakdown of agreements that the prisoners made before being questioned.
4
An equilibrium in which each firm in an oligopoly maximizes profit, given the actions of its rivals, is called
a dominant equilibrium.
a Nash equilibrium.
a general equilibrium.
an oligopoly equilibrium.
5
A cooperative agreement among oligopolists is less likely to be maintained,
the more likely it is that the game among the oligopolists will be repeated
the larger the number of buyers of the oligopolists’ product.
the smaller the number of buyers of the oligopolists’ product.
the greater the number of oligopolists.
6
Game theory is necessary to understand which kinds of markets? (Select all that apply)
monopoly
monopolistically competitive
duopoly
oligopoly
7
In an oligopoly market, the Nash Equilibrium
is a stable outcome despite providing a lower total profit level.
always result in the maximum profit for all firms.
results in a output level below that for a monopoly
leads to zero economic profit once the equilibrium is reached