The analytical framework in which two or more firms compete for certain payoffs that depend on the strategy that the others employ is
A) game theory.
B) the concentration ratio.
C) a horizontal merger.
D) network effect.
Answer: A
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If the price of Sea World tickets increased what might we expect to see happen to tickets for Disneyland?
A. Decreased supply of Disneyland tickets B. Increased demand for Disneyland tickets C. Decreased demand for Disneyland tickets D. Increased supply of Disneyland tickets
The quantity of ________ by households will be less ________
A) saving; the higher is disposable income B) saving; the lower is the real interest rate C) consumption; the lower is the inflation rate D) consumption; the higher is disposable income
The government could offer a subsidy to offset a:
A. negative externality. B. positive externality. C. network externality. D. A subsidy could offset any of these.
In an oligopolistic market, if rival sellers act independently, each will have a strong incentive to
a. reduce price in order to increase sales and gain a larger share of the total market. b. increase price in order to get a larger share of the market and make larger profits. c. restrict output and raise price in order to achieve higher profits. d. maintain agreements to lower price and decrease product quality in order to earn higher profits.