Question 1
The oligopolistic model in which firms produce exactly the same results as would exist if a monopolist controlled the entire industry is called the ________ model.
◦ Cournot
◦ price leadership
◦ maximin strategy
◦ collusion
Question 2
Refer to the information provided in Figure 14.1 below to answer the question(s) that follow.
Refer to Figure 14.1. Six firms that produce chewing gum form a cartel. The cartel faces the market demand curve given by
D. To maximize profits, the cartel should produce ________ packs of chewing gum and the price should be ________.
◦ 12,000; $.25
◦ 12,000; $.40
◦ 14,000; $.30
◦ 16,000; $.35
How to calculate present value (Question 2)
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