Author Question: The dominant-strategy solution implies that each firm a. ignores the reactions of competitors b. ... (Read 53 times)

mia · **on:** Jun 30, 2018

The dominant-strategy solution implies that each firm
a. ignores the reactions of competitors
b. colludes with competitors to maximize industry profits
c. ignores the decisions of the other firms
d. takes all potential bits of information into consideration before making a decision
e. selects the optimal solution to a game

Question 2

An externality is
a. a cost of a transaction that is borne by a third party
b. a benefit of a transaction that is enjoyed by a third party
c. a cost or benefit that arises when market price changes
d. any cost or benefit of a transaction that is not accounted for in the market price
e. the external revenue generated by a firm