11.For the same demand and cost conditions, which of the following is true? a. C
ID: 1121811 • Letter: 1
Question
11.For the same demand and cost conditions, which of the following is true?
a. Consumer surplus is less in a monopoly market compared to pure competition.
b. Consumer surplus is greater in a monopoly market compared to pure competition.
c. Consumer surplus is the same in a competitive market compared to monopoly.
d. None of the above.
12. In a Prisoners’ Dilemma model,
a. Each player will have a dominant strategy
b. Each player will choose a strategy (her dominant strategy) that makes her better off individually but makes both players worse off
c. If players have a payoff associated with the strategy that makes them both better off rather than the strategies chosen in the game, each player will have an incentive to change their strategies
d. a.,b., and c. are correct
e. a.,b., and c. are each incorrect
13. Removal of the restrictions in the taxicab industry is most likely to result in:
a. an increase in the operation of illegal cabs.
b. reduced safety of passengers.
c. a shift of taxicab services from poor neighborhoods to the city.
d. a large financial loss for those who currently own medallions.
14. Which of the following are not assumptions underlying a price discrimination model?
a. The firm must have some monopoly power
b. It is impossible to resell a product from one market to another
c. Different elasticities of demand in different submarkets
d. The product involved is a service (like an appendectomy)
15. Before Uber under the restrictions, which of the following would positively affect the price of a medallion?
a. An increase in the population of a city in which cabs operated
b. An increase in the number of conventions in city in which cabs operate
c. Economic growth which increases in the income of residents in the city in which cabs operate
d. All of the above
e. Neither A). B) or C) are correct
Explanation / Answer
11) correct option is a), Because in monopoly firm charges higher prices so as to maximize profit thus reducing consumer surplus.
12) The correct option is a) because each have a dominant strategy which will be lower payoff
13) The correct option is b) because restrictions prevent untrained drivers from getting into the business thus provides safety.
14)Option d, the product can be goods as well .
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