In a Bertrand model, graphically, the intersection of all firms' best-response curves determines
A) the Nash equilibrium prices.
B) the dominant strategy for each firm.
C) the degree of product differentiation.
D) the price of the market leader.
A
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Because there is an imbalance of information in a lending situation, we must deal with the problems of adverse selection and moral hazard. Define these terms and explain how financial intermediaries can reduce these problems
What will be an ideal response?
The IS curve becomes steeper when there is
a. a higher marginal propensity to save. b. a smaller parameter measuring the interest sensitivity of investment. c. a lower marginal propensity to save. d. Both a and b e. Both b and c
Assuming that increasing the utility of the transfer recipient is the only relevant criterion then an in-kind transfer would _____
a. never give more utility than an equal cash payment b. never give less utility than an equal cash payment c. always give the same utility as an equal cash payment d. always give less utility than an equal cash payment
When future labor income rises in a large open economy, it causes the current account to ________ and investment to ________.
A. fall; fall B. rise; remain unchanged C. fall; rise D. rise; rise