The above figure shows the payoff matrix for two firms, A and B, selecting an advertising budget. The firms must choose between a high advertising budget and a low advertising budget. Firm B's dominant strategy
A) does not exist.
B) is to copy firm A.
C) is to select a high advertising budget.
D) is to select a low advertising budget.
C
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Refer to Figure 4.8. This game will end up with
A) everyone at the beach. B) everyone at the park. C) half of your friends at the beach and half at the park. D) either a or b
Suppose a Chinese restaurant provides free tea and fortune cookies to its customers. The restaurant is clearly
A) generating a negative externality. B) generating a positive externality. C) selling food below cost. D) attempting to increase its total profit. E) doing none of the above.
The typical shape of an isoquant is
A) linear and upward sloping. B) convex towards the origin. C) concave towards the origin. D) linear and downward sloping.
The U.S. government
A. intervenes to prevent the monopolization of any market. B. forbids the creation of legal impediments to entry into any market. C. intervenes to prevent the monopolization of some markets and actively encourages the monopolization of others. D. encourages the permanent monopolization of all markets in which the monopolist has technical superiority over potential competitors.