Firm A has a strictly higher marginal cost than firm B. They compete in a homogeneous product Bertrand duopoly. Which of the following results will NOT occur?
A. Revenue of firm A < Revenue of firm B
B. ProfitA = 0 < ProfitB
C. PriceA < PriceB
D. QA < QB
Answer: C
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The social arrangements that govern the ownership, use, and disposal of property are referred to as
A) the double coincidence of wants. B) capitalism. C) private enterprise. D) property rights.
In the figure above, what is Gap's excess capacity?
A) 32 jackets per day B) zero C) 4 jackets per day D) 132 jackets per day
If a union establishes by collective bargaining a wage rate that is above a competitive market equilibrium wage rate, then
A) an excess quantity of labor will be supplied. B) a shortage of labor will result. C) there will be an increase in total employment. D) management will want to substitute labor for machinery.
When an economy is at full employment, increasing its military production:
a. causes a movement along the PPF. b. causes an outward shift in the PPF. c. means that the economy is operating outside the PPF. d. means that the economy is operating inside the PPF.