Answer the following statement(s) true (T) or false (F)
1. In a contestable market with room for many firms, industry output will be the same as in a successful cartel.
2. The Cournot oligopoly model is based on the assumption that firms treat their rivals' output as fixed and given.
3. Firms' total output is higher in the Cournot oligopoly model than in the Bertrand oligopoly model.
4. In both competition and monopolistic competition, free entry and exit guarantee that the industry's output is produced at the least possible cost.
5. Social welfare would be increased if a monopolistically competitive industry were replaced with a competitive industry.
1. False
2. True
3. False
4. False
5. False
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What is an ascending-value auction?
To assess the benefit of a product never consumed, the brain bases its benefit valuation on:
A. chance. B. past experiences with similar products. C. the cost of the product. D. The brain cannot value the benefit of a product never consumed.
Which of the following is a policy option to eliminate an AD shortfall?
A. Reduce taxes. B. Reduce transfer payments. C. Decrease government purchases. D. All of the choices are correct.
Those that lose from an increase in the minimum wage are
A. consumers who pay lower prices for goods. B. all workers. C. those workers who keep their jobs. D. employers.