Consider a game of the "Jack and Jill" type in which a market is a duopoly and each firm decides to produce either a "high" quantity of output or a "low" quantity of output. If the two firms successfully reach and maintain the cooperative outcome of the game, then
a. both the combined profit of the firms and total surplus are maximized.
b. the combined profit of the firms is maximized but total surplus is not maximized.
c. the combined profit of the firms is not maximized but total surplus is maximized.
d. neither the combined profit of the firms nor total surplus is maximized.
b
You might also like to view...
Arthur is an unskilled worker who is currently unemployed. He has been offered a job that pays $40 a day, but he is currently receiving unemployment insurance benefits equal to $50 a day, so he chooses not to accept the job and to continue looking for a better job. Arthur is ________ unemployed.
A. cyclically B. structurally C. not D. frictionally
Which of the following is an example of an inverse relationship?
A) hours of study and test grade B) calories eliminated from diet and weight loss C) beers consumed while studying and test grade D) amount of snowfall and profits of ski resorts
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.
Economists use the word investment to refer to the portion of income that is:
A. spent on productive inputs, such as factories, machinery, and inventories. B. not immediately spent on consumption of goods and services. C. placed in an individual's savings account. D. in any interest-bearing account.