If two firms in an oligopoly produce undifferentiated products and face identical constant marginal costs, then, absent any implicit or explicit collusion, they will price at marginal cost regardless of whether they move sequentially or simultaneously -- assuming price is the strategic variable.
Answer the following statement true (T) or false (F)
True
Rationale: This is a description of the classic Bertrand model and prediction.
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Pricing is an aspect of a firm's:
A. conduct. B. environment. C. performance. D. structure.
In a fixed exchange rate system
A. market forces play a role in determining the fixed value of a currency. B. a central bank affects the value of a currency by changing its foreign exchange reserves. C. the International Monetary Fund determines exchange rates. D. market forces and the country's stock of gold determine its exchange rate.
Economics is often described as a science of constrained choice. How do you justify this argument?
What will be an ideal response?
Cartels tend not to be long-lived because of ?the Prisoner's Dilemma.
Answer the following statement true (T) or false (F)