Suppose in the ice-cream market with 10 firms, the elasticity of market demand is -1, and each firm has a constant marginal cost at $2. The Nash-Cournot equilibrium price is
A) $2.
B) $2.2.
C) $2.4.
D) $2.5.
A
You might also like to view...
Which of the following is true?
a. Monopolists, monopolistically competitive firms and perfectly competitive firms all earn positive economic profits in the long run. b. Monopolists, monopolistically competitive firms and perfectly competitive firms all earn zero economic profits in the long run. c. Only monopolists and monopolistically competitive firms, but not perfectly competitive firms, can earn positive economic profits in the long run. d. Monopolists, monopolistically competitive firms and perfectly competitive firms can potentially all earn positive economic profits in the short run.
If President Obama agrees with his economic advisers who advocate cutting the rate of unemployment to 3 percent and the rate of inflation to 2 percent, you know he
a. believes the Phillips curve represents his only options b. believes in the rational expectations theory c. is a Keynesian d. is a neo-Keynesian e. believes the Laffer curve has validity
Consumer surplus, the net benefit that consumers get from market exchange, can be used to:
a. measure purchasing power of consumers. b. measure market supply. c. measure economic welfare. d. measure economic growth.
When formulating financial policy, managers also have to consider the appropriate balance between:
A. receivables and payables. B. interim and final dividends. C. short-term and medium-termfinance. D. short-term and long-termfinance.