One of the surprising conclusions of many of the noncooperative models of oligopoly is that firms end up better off with the noncooperative outcome than they would by cooperating with one another. Indicate whether the statement is true or false ANSWER FALSE
Date: September 10th, 2020
In comparing an oligopolistic firm to a perfectly competitive firm it is generally assumed that the price charged by the competitive firm will be higher than the price charged by the oligopolistic firm. Indicate whether the statement is true or false ANSWER FALSE
Date: September 10th, 2020
If a 10 percent increase in the price of a luxury hotel room causes the quantity demanded to decrease by 41.5 percent., we can conclude that the price elasticity of demand for luxury hotel rooms is approximately -0.24. Indicate whether the statement is true or false ANSWER FALSE
Date: September 10th, 2020
Government expenditures are considered autonomous in the model meaning that changes are the result of: A) changes in real income. B) changes in inflation. C) changes in unemployment. D) changes in policy decisions. ANSWER D
Date: September 10th, 2020
Knowledge about the price elasticity of demand is especially useful to managers because it allows them to predict how a change in price would affect a firm’s total revenues. Indicate whether the statement is true or false ANSWER TRUE
Date: September 10th, 2020
A home theater system and an HD television would be considered an example of: A) substitute goods. B) giffen goods. C) inferior goods. D) complementary goods. ANSWER D
Date: September 10th, 2020
Pepsi and Coke have competed in the market for bottled water primarily on the basis of convenience and product differentiation as a means to avoid the negative effects on revenue that result from price competition. Indicate whether the statement is true or false ANSWER TRUE
Date: September 10th, 2020
DSL and broadband internet service would be considered an example of: A) substitute goods. B) giffen goods. C) inferior goods. D) complementary goods. ANSWER A
Date: September 10th, 2020
For the simple case of a production function with two inputs in which the inputs are perfect complements, each isoquant is represented by: A) a vertical line. B) a horizontal line C) a downward sloping straight line. D) a line that forms a right angle. ANSWER D
Date: September 10th, 2020
One could argue that price competition among oligopolistic firms is highly likely to cause the revenues of individual firms to decline, while competition on the basis of product differentiation could cause demand, and total revenues, of individual firms to increase. Indicate whether the statement is true or false ANSWER TRUE
Date: September 10th, 2020
