When an oligopoly is in a Nash equilibrium
A) firms have colluded to set their prices.
B) firms will not behave as profit maximizers.
C) a firm will not take into account the strategies of its rivals.
D) a firm will choose its best pricing strategy, given the strategies that it observes other firms have taken.
Answer: D
You might also like to view...
In the figure above, when disposable income equals $10 trillion,
A) consumption expenditure is greater than disposable income but it is not possible to determine if consumers are saving or dissaving. B) consumption expenditure is less than disposable income, so consumers are dissaving. C) consumption expenditure is less than disposable income, so consumers are saving. D) consumption expenditure is greater than disposable income, so consumers are saving. E) consumption expenditure is greater than disposable income, so consumers are dissaving.
You are studying with a friend, and your friend says "To maximize utility, a consumer must consume the combination of goods so that the marginal utility of good X equals the marginal utility of good Y
" Explain whether your friend's statement is correct or incorrect.
All of the following is consistent with the classical theory of employment EXCEPT
A. The interest rate will equalize savings and investment. B. Everything produced will necessarily be purchased. C. Saving and investing are done by different people for different reasons. D. Wages and prices are flexible downwards.
Which of the following makes the U.S. market more attractive to foreign buyers?
a. depreciation of the dollar b. contractionary monetary policy by the Fed c. increase in price of U.S. goods d. increase in U.S. interest rates