One criticism of the Bertrand pricing model is that
A) the model is implausible when there is product differentiation.
B) when there is an oligopoly with no product differentiation, the model's prediction is inconsistent with reality.
C) the model's predicted price is solely a function of demand conditions.
D) the model's predicted price is dependent on the number of firms.
B
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For a duopoly, the maximum total profit is reached when the duopoly produces
A) the same amount of output as the competitive outcome. B) the same amount of output as the monopoly outcome. C) an amount of output that lies between the competitive outcome and the monopoly outcome. D) more output than the competitive outcome. E) less output than the monopoly outcome.
What is the aggregate demand multiplier and why does it occur?
What will be an ideal response?
The short-run aggregate supply curve is vertical
Indicate whether the statement is true or false
In long-run equilibrium after a permanent money-supply increase there follows:
A) an increase in exchange rate, E. B) a decrease in exchange rate, E. C) an increase in output, Y. D) a decrease in output, Y. E) an unchanged exchange rate, E.