Nash equilibrium is:
a. where one player maximizes his payoff and the other doesn't
b. where each player maximizes the expected payoff
c. similar to a dominant strategy
d. difficult to determine
b
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The manner in which one oligopolist reacts to a change in price, output, or quality made by another oligopolist in the industry is
A) a cooperative game. B) the reaction function. C) a zero-sum game. D) the concentration ratio.
When a monopolist's marginal cost of production is zero:
a. the deadweight loss is reduced. b. production is lower than if marginal cost were positive. c. the price charged is higher than if marginal cost were positive. d. maximizing profit is same as maximizing revenue.
A monopolistically competitive firm has a:
A. highly elastic demand curve. B. highly inelastic demand curve. C. perfectly inelastic demand curve. D. perfectly elastic demand curve.
In perfect competition, a profit-maximizing business will expand until its marginal cost equals the market price.
Answer the following statement true (T) or false (F)