In the Hotelling model, firms can avoid price competition by differentiating their products
Indicate whether the statement is true or false
T The firms can locate at the ends of the Hotelling's Main Street, so their prices have small rather than large effects on their competition for sales.
You might also like to view...
Economists refer a to a market where buying and selling take place at prices that violate government price regulations as
A) a noncompetitive market. B) an outlaw market. C) a black market. D) a restricted market.
In economic terms, interest is the payment for
A) current command over resources. B) producers' goods. C) stocks. D) both consumer and capital goods.
Suppose Bev's Bags makes two kinds of handbags-large and small. Bev rents an industrial space where she keeps the fabric, the industrial sewing machine, her measuring board and cutting shears, extra needles, thread and buttons, and labels. Which of the following would be considered a variable cost of this company?
A. The cutting shears B. The fabric C. The rent D. None of these would be considered a variable cost.
Allocative efficiency occurs when firms produce:
a. where price equals minimum long run average cost. b. where price equals marginal cost. c. where consumer surplus is zero and producer surplus is positive. d. where marginal benefit equals marginal cost.