mar ket to be competitive when the firms A) wadanee amounts of money on R) spend
ID: 1108669 • Letter: M
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mar ket to be competitive when the firms A) wadanee amounts of money on R) spend lagge amounts C) are price takers D) All of the above h each other's behavior closely advertising to lure customers away from the competition 2) oonomists define a market to tions must be true so that a firm can profitably price ) The good cannot be easily resold. There are no other firms in the market. B) The good is a non-durable. D) All of the above. which two Cournot duopolist Q Firm I's best-response function is st firms operate at zero marginal cost. The market demand is o p a 2A) 240 Suppase B) q1- a/2b. D) q1- a/b. The monopoly maximizes profit by setting A) marginal revenue equal to marginal cost. B) price equal to marginal revenue. D) marginal revenue equal to zero. 25) price equal to marginal cost. 28 the ivere demancrve a a monopoly faces is p 100-20, and MC is constant at 16, then profit MC is 26) A) is achieved only by shutting down in the short run B) is achieved by setting price equal to 21. Cis achieved when 21 units are produced DJ cannot be determined solely from the information provided. Compared to a cartel, firms in a Cou mot Oligopoly 27) A) act independently C) make less joint profit. B) sell less output D) make more joint profit. 28) A firm will increase its spending on advertising until 28) A) it has deterred all future entry 8) the marginal benefit of advertising equals the marginal cost of advertising. the marginal benefit of advertising is zero. D) it has monopolized the market 29) A cartel is a group of firms that attempts to A) increase consumer surplus. )behave independently 29) B) maximize joint revenue. D) maximize joint profit. Firms that exhibit price-taking behavior A)take pricing behavior in their own hands. B)j wait for other firms price, t Qhave outputs that are too small to 30) to set price, take it as given, and charge a higher price. D) are indpenduence market price and thus take it as given.Explanation / Answer
22.A feature of perfect competition is that firms are price takers because no single producer has any influence over the price.
Answer-c.
23.D.All the conditions are required for a monopolist to price discriminate.
25.A.Equilibrium condition for a monopolist is that marginal revenue is equal to marginal cost.That way the monopolist earns profits.
26.P=100-2Q
TR=100Q-2Q^2
MR=100-4Q
MC=16
At equilibrium:
100-4Q=16
4Q=84
Q=21
P=100-2*21=58
Answer-c.
29.D.Cartels is a group of firms that act together to maximize profits.Answer-D.
30.C
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