According to the figure shown:
A. there is no stable equilibrium to the game.
B. both players will act in their own self-interest and get an optimum equilibrium that is stable.
C. both players will act in their own self-interest and get a stable, but less than optimum, equilibrium.
D. both players have an incentive to charge a low price and undercut the competition.
Answer: C
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Which of the following is characteristic of oligopoly, but NOT of monopolistic competition?
A) The choices made by one firm have a significant effect on other firms. B) Each firm faces a downward-sloping demand curve. C) Firms are profit-maximizers. D) There is more than one firm in the industry.
If a firm hires 312 workers it will produce 4,522 units of output. If it hires 313 workers it will produce 4,786 units of output. The marginal physical product of labor equals
A) 4,786. B) 313. C) 264. D) 1.
Jerome, the florist, sold 500 bridesmaid's bouquets in June. He estimates his costs that month were ATC = $10, AVC = $6, and MC = $9 . If he sold each bouquet at the constant market price of $9, Jerome:
a. made an economic profit of $500. b. made a loss of $500. c. made an economic profit of $1,500. d. made a loss of $1,500. e. should have shut down in June.
Monetary policy is the system of actions taken by the Fed to influence the money supply.
Answer the following statement true (T) or false (F)