Which of the following is a difference between an oligopoly with differentiated products and a monopolistic competition?
A) There are no barriers to entry in an oligopoly with differentiated products, while there are huge barriers to entry in a monopolistic competition.
B) There are huge barriers to entry in an oligopoly with differentiated products, while there are minimal barriers to entry in a monopolistically competitive market.
C) Firms in an oligopoly market with differentiated products charge a price higher than marginal cost in the long run, while firms in a monopolistic competition charge a price lower than marginal cost in the long run.
D) Firms in an oligopoly with differentiated products charge a price lower than average total cost in the long run, while firms in a monopolistic competition earn a price higher than average total cost in the long run.
B
You might also like to view...
In a duopoly game we observe the following payouts: if the two firms collude they will each earn $50,000. If one firm cheats then he earns $60,000 and the other firm earns -$10,000. If both firms cheat then they each earn zero economic profit
In this game what is the Nash equilibrium? A) Both firms cheat. B) Only one firm will cheat. C) Neither firm will cheat. D) It is impossible to say.
Say a monopolist sells in two separate markets, with demand PA = 100 - 2Q and PB = 50 - Q respectively. Marginal costs in both markets are constant and equal to 8. The monopolist would charge a price of ________ in market B in order to maximize profits.
A. 8 B. 0 C. 29 D. 21
Assume nominal GDP is $10,000 trillion in period 1 and $15,000 trillion in period 2. If prices in period 2 are twice as high as in period 1, real GDP in period 2 is
A. $15,000 trillion measured in period 1 prices. B. $12,500 trillion measured in period 1 prices. C. $10,000 trillion measured in period 1 prices. D. $7,500 trillion measured in period 1 prices.
Mandated reductions in tailpipe emissions from automobiles are an example of:
A. government provision. B. specific taxes. C. the Coase Theorem. D. direct controls.