Why do economists use game theory to study the actions of firms in oligopoly markets but not in other markets?
In oligopoly markets, there are a few firms whose actions are interdependent. Hence, oligopolists have strategies that economics can model using game theory. Only one firm exists in a monopoly, so there are no interdependent actions of firms. In perfect competition and monopolistic competition, there are so many firms that each firm is too small for its actions to affect other firms in the market.
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Sergio's rentals of Blu-ray movies increase by 10 percent when her income increases by 30 percent. Based on this information, we know that for Sergio, Blu-ray movies
A) are complements. B) are substitutes. C) are inferior goods. D) have an inelastic demand. E) are normal goods.
In the Keynesian liquidity preference framework, a rise in the price level causes the demand for money to ________ and the demand curve to shift to the ________, everything else held constant
A) increase; left B) increase; right C) decrease; left D) decrease; right
Suppose a person with an income of $20,000 pays a tax of $2,000 . If the tax is progressive, then how large of a tax will a person with an income of $40,000 pay?
a. Exactly $2,000. b. Between $2,000 and $4,000. c. Exactly $4,000. d. More than $4,000.
____ has(have) traditionally been the chief instrument of environmental policy in the United States
a. Taxes on pollution b. Voluntary compliance c. Tradable emissions permits d. Direct controls