Frozen Treats and Dairy Treats are two ice cream firms that are competing with each other. If Frozen Treats announces an upcoming price change next month, it may be signaling to Dairy Treats its intent to engage in ________.
A) a Cournot oligopoly
B) tacit collusion
C) a Chamberlin oligopoly
D) a Stackelberg oligopoly
B) tacit collusion
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The short-run average variable cost curve
a. is always downward-sloping b. starts at the origin and always slopes upward c. starts above the origin and always slopes upward d. is a horizontal line intersecting the vertical axis e. slopes downward at low rates of output, then slopes upward at higher rates of output
Demand refers to the amount buyers wish to buy, whereas the quantity demanded refers to the position of the demand curve
a. True b. False Indicate whether the statement is true or false
For Outback Steakhouse, seating capacity is limited in the short run. In the long run, they can add as many seats as they want. Therefore, the price elasticity of supply for meals at Outback would be ________ in the short run than in the long run.
A. the same B. more variable C. lower D. higher
A profit-maximizing firm in the short run will expand output:
A. until total revenue equals total cost. B. as long as marginal revenue is greater than marginal cost. C. until marginal cost begins to rise. D. until marginal cost equals average variable cost.