ECO 201 Chap 13

Card Set Information

ECO 201 Chap 13
2011-12-05 15:47:54
Oligopoly markets

Oligopoly price leadership
Show Answers:

  1. What do Wal-Mart , Microsoft Corp and dell companies have in common
    The profitability of ea firm depends on its interactions with other firms. They depend on ea other
  2. When large firms in oligoply markets cut their prices
    We don't know for sure how rivals firms will respond
  3. The fraction of an industry's sales that are accounted for by the largest firms is called
    The four firm concentration ratio
  4. As a measure of competition in an industry, concentration ratios have several flaws. One of these flaws is the concentration ratios
    Assume that a ratio less than 40 percent means an industry is perfectly competitive.
  5. Which of the following is NOT a characteristic of oligopoly
    Low barriers to entry
  6. Economies of scale will create a barrier to entry in an oligopoly industry when
    the typical firm's longrun average total cost curve reaches a minimum at a level of output that is a large fraction of total idustry sales.
  7. The DeBeers Company blocked competititon
    in the diamond market by controlling the output of most of the worlds diamond mines.
  8. The justification for occupational licensing lasw is that they protect the public from imcompetent practitioners (for example, lawers and med doctors, but the laws also result in
    A higher price and restrictions on the number of people who can enter the professions affected by the laws.
  9. In economics, the study of the decisions of firms in industries where the profits of each firm depend on its interactions with other firms is called
    Game theory
  10. When an oligolpoly market is a Nash equalibrium
    a firm will choose its best pricing strategy given the strategies that it observes other firms have taken
  11. Prisoner's dilemma games imply that cooperative behavior between two people two firms always breaks down. But reality teaches us that people and firms often cooperate successfully to achieve their goals. Why do the results from prisoner's dilemma games fail to predict real world results?
    Choose the strategey that maximizes the total game payoff
  12. Which of the following is an example of implicit collusion or oligopoly
    price leadership
  13. All of the following are ways by which existing firms can deter the entry of new firms into an industry except
    threatening to raise prices
  14. A large majority of personal computers (PCs) in the US used an operating system purchased from Microsoft. Microsoft relationship w PC manufacturers is an example of which of Porter's competitive forces?
    The bargining power of suppliers
  15. The supplier of an input is unlikely to have bargining power if
    Many firms can supply the input