Table 14.4In Table 14.4, Market 3 would be in equilibrium if buyers believed plums accounted for:
A. 11.11% of the market.
B. 22.22% of the market.
C. 33.33% of the market.
D. 66.67% of the market.
Answer: C
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One defense Microsoft can use to argue that it does not have monopoly power in the market for operating systems, is to show that
a. demand for operating systems is highly elastic. b. many other commodities have higher income elasticities of demand than operating systems. c. the cross elasticity of demand between Microsoft’s operating system and other operating systems is large and positive. d. many of its competitors' products are complements for its service.
A strategy that limits defection in a repeated prisoner's dilemma game is:
A. a tit-for-tat strategy. B. an ultimatum bargaining game. C. a Nash equilibrium. D. a cartel.
If a country's currency is "pegged" to the dollar, its exchange rate is
A) floating. B) flexible. C) undervalued. D) fixed.
Equivalent variation is a method employed to measure excess burden. Comment on why a method such as compensating variation would not be appropriate for this analysis.
What will be an ideal response?