With asymmetric information among consumers and positive search costs, a firm may
A) raise its price above the monopoly price.
B) price at the monopoly level.
C) price at the full information competitive level.
D) None of the above.
B
You might also like to view...
Scientists have said for years cod was so seriously overfished in European Union waters that there was a risk of extinction due to stock collapse. Why would overfishing occur in this common market?
A) Fishing occurs until marginal cost per boat equals marginal social benefit which is inefficient. B) Fishing occurs until marginal social cost per boat equals marginal social benefit which is inefficient. C) Fishing occurs until marginal cost per boat equals marginal benefit which is inefficient. D) Fishing occurs until marginal social cost per boat equals marginal cost which is inefficient.
Monopolists are criticized because they are inefficient. What is meant by this statement?
A. Monopolists could use their resources better elsewhere. B. Monopolists don't innovate enough to control pollution. C. Monopolists produce a large quantity of waste. D. Monopolists usually don't produce at the minimum of the ATC.
A market with a large number of sellers
A) can only be a perfectly competitive market. B) might be an oligopoly or a perfectly competitive market. C) might be a monopolistically competitive or a perfectly competitive market. D) might be a perfectly competitive, monopolistically competitive, oligopoly, or monopoly market. E) can only be a monopolistically competitive market.
The principal-agent problem arises because the agent's objectives differ from those of the principal
a. True b. False