The paradoxical nature of oligopoly can be demonstrated by the fact that, even though the monopoly outcome is best for the oligopolists,
a. they collude to set the output level equal to the Nash equilibrium level of output.
b. they have incentives to increase production above the monopoly outcome.
c. they do not behave as profit maximizers.
d. self-interest juxtaposes the profits earned at the Nash equilibrium.
b
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If official U.S. poverty statistics included in-kind transfer payments the:
a. poverty rate would be close to zero. b. poverty rate would be lower. c. government deficit would be lower. d. top 10 percent of those in the income distribution would be wealthier.
The government regulates bank mergers, sometimes denying the proposed merger. Often the reason given for the denial is to protect small investors. What are small investors being protected from?
A. mergers can increase the monopoly power of banks and the bank may seek to exploit this power by raising prices and earning unwarranted profits. B. bank runs hurt larger banks more than smaller banks. C. in order to pay for the merger, the bank may seek higher returns putting the depositors' funds at greater risk. D. with a larger bank the bank is likely to take greater risk and may fail.
A monopoly will look for opportunities to price discriminate because the practice
A. leads to greater profits. B. allows it to charge higher prices. C. leads to selling more units. D. is desired by customers.
Market equilibrium occurs when
A. the quantity demanded equals the quantity supplied. B. the market is changing rapidly. C. other things remain the same. D. buyers get the lowest possible price. E. everyone who wants the good gets the quantity he or she wants.