« previous next »

Author Question: If firms in duopoly collude and operate as a monopoly, the industry produces more output compared to ... (Read 82 times)

lindiwe

  • Hero Member
  • *****
  • Posts: 577
on: Jun 29, 2018
If firms in duopoly collude and operate as a monopoly, the industry produces more output compared to the Nash equilibrium. True or false? Explain.
 
  What will be an ideal response?

Question 2

Because of a decrease in labor costs, a monopoly finds that its marginal cost and average total cost have decreased. The monopoly ________ its price and ________ its quantity.
 
  A) raises; increases
  B) raises; decreases
  C) lowers; increases
  D) lowers; decreases


jackie

  • Sr. Member
  • ****
  • Posts: 324
Reply #1 on: Jun 29, 2018
Answer to Question 1

The statement is false. In the Nash equilibrium, both firms cheat and output is the same as in perfect competition. If the firms operate as a monopoly, the industry's profit-maximizing level of output is below the competitive level.

Answer to Question 2

C


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

Children with strabismus (crossed eyes) can be treated. They are not able to outgrow this condition on their own, but with help, it can be more easily corrected at a younger age. It is important for infants to have eye examinations as early as possible in their development and then another at age 2 years.

Did you know?

Though “Krazy Glue” or “Super Glue” has the ability to seal small wounds, it is not recommended for this purpose since it contains many substances that should not enter the body through the skin, and may be harmful.

Did you know?

Fungal nail infections account for up to 30% of all skin infections. They affect 5% of the general population—mostly people over the age of 70.

Did you know?

To maintain good kidney function, you should drink at least 3 quarts of water daily. Water dilutes urine and helps prevent concentrations of salts and minerals that can lead to kidney stone formation. Chronic dehydration is a major contributor to the development of kidney stones.

Did you know?

The average office desk has 400 times more bacteria on it than a toilet.

Mixing bacterial genotypes produces rare recombinants Mixing bacterial genotypes produces rare recombinants
Cardiac Output Cardiac Output
Mirror Box Therapy Compared to Mental Visualization and a Control Condition Mirror Box Therapy Compared to Mental Visualization and a Control Condition
All computer systems perform four basic functions: input, processing, storage, and output. All computer systems perform four basic functions: input, processing, storage, and output.
The population of algae is compared to the population of corals in a given sampling area The population of algae is compared to the population of corals in a given sampling area
DNA and RNA compared DNA and RNA compared
Video: Types of antimicrobial substances (interferons & complement protein)

For a complete list of videos, visit our video library