e) may be no more efficient due to a lack of firm interdependence, c) may be less desirable because they are not regulated by government to protect consumers. E) Each firm has an incentive to cheat. a. A price war is a competition among the competitors of the business in lowering the price of their products to gain an advantage over their competitors in price and capture a greater market share. a) The outcomes for all firms are negative. single family housing and would be an attractive site for single family homes. ratio. d) The firms in the industry are interdependent. The distinctive feature of an oligopoly is interdependence. A) a market where three dominant firms collude to decide the profit-maximizing price. c) The percentage of total industry sales accounted for by the four largest firms Because of this, every firm takes decisions very carefully by considering the possible reactions of the rival firms. *Large capital investment The characteristics of oligopoly include interdependence, product differentiation, high barriers to entry, uncertainty, price setters. C) in a repeated game but not a single-play game. C) specify how marginal cost is determined. The point at which an upward-sloping marginal cost curve intersects a downward-sloping marginal revenueMarginal RevenueThe marginal revenue formula computesthe change in total revenue with more goods and units sold." A) raise the price if marginal revenue increases B) lower the price if the new marginal cost curve lies below the break in the marginal revenue curve C) definitely lower the price D) not change the price E) raise the price if other firms raise their prices. Based on her experience with past negotiations, Marilyn knows that lenders are concerned about DTRs debt to equity 3) Canada's anti-combine law is enforced by a) Demand is highly elastic below the going price c) All oligopolists' or imperfect competitors' demand curves are down-sloping because they are price makers. Which of the following is not a characteristic of oligopoly? A) a firm in an oligopoly market. E) none of the above. It is used as one of the strategies to increase the business firm's revenue and increase the market share. A Computer Science portal for geeks. *To increase economies of scale. C) Trick cheats, while Gear complies with the agreement. c) threatens e) price changes are typically expensive, b) product development and advertising are relatively difficult to copy, Oligopolies are not a desirable market structure because they achieve ______. What kind of game is it if the firms must choose their pricing strategies at the same time? A) kinked demand curve. . e) straight c) losses; prices; increase, What is it called when a group of producers creates a formal written agreement stating the level of output by each firm and the prices that must be charged? Patent rights or accessibility to technology may exclude potential competitors. E) both are price takers. Cost of firm A is lower than firm B Profit maximizing price and quantity of firm A is PA and XA respectively. In other words, when there are two or more than two, but not many, producers or sellers of a product, oligopoly is said to exist. 9) In the dominant firm model of oligopoly, the dominant firm faces a marginal cost pricing The joining of firms that are producing or selling a similar product is a horizontal merger Suppose an industry has total sales of $25 million per year. When there are two firms, the market structure is called duopoly, The number of buyers will be quite large as in other market models, If the products of all firms are homogeneous, then it is called , If the products are differentiated, then it is called , The nature of products of the firms is crucial in making price and output decisions. C) there are numerous producers of two goods competing in a competitive market B) revenues, elasticity, profit, and payoffs. B) of barriers to entry. d) Dominant firms, What are oligopolists able to do by controlling price through collusion? b) its rivals match price increases and price decreases What happens to oligopolistic firms when a recession occurs? d) their profits and sales will rise. E) None of the above. It is calculated by dividing the change in the costs by the change in quantity.read more is the cost of productionCost Of ProductionProduction Cost is the total capital amount that a Company spends in producing finished goods or offering specific services. Due to minimal competition, each of them influences the rest through their actions and decisions. C) strategies c) Dominant firms It is used as one of the strategies to increase the business firm's revenue and increase the market share.read more. *world trade What is the Nash equilibrium? See more documents like . Firms in the industry make price and output decisions with an eye to the decisions and policies of other firms in the industry. d) import competition, Suppose the rivals of an oligopolistic firm match either a price increase or decrease. Marilyn is also aware that DTR issued$10 million of common stock to a long-time friend of the Pure (Perfect) Competition 2. Business Economics Consider a Cournot oligopoly with n = 2 firms. B) collusion D) Bud has a dominant strategy but Miller does not. d) elastic, An oligopoly firm's demand curve will be kinked if ______. The marginal revenue formula computesthe change in total revenue with more goods and units sold." Marginal revenue = Change in total revenue/Change in quantity sold. a. C) the HHI for the industry is small. e) Firms may sell a differentiated product. Features: Many and small sellers, so that no one can affect the market a) Import competition An oligopoly is an industry dominated by a few large firms (Few sellers supplying, many buyers). E) an oligopoly. Because of their large size and minimal competition, each firm in an oligopoly market structure influences the others. (Enter one word for each blank. Oligopoly: Definition, Characteristics and Concepts - Toppr-guides a) They do not achieve allocative efficiency because their average total cost exceeds price. They believe in making customers stick to their brands for core competenciesCore CompetenciesThe core competencies in business refer to its resources and unique fundamental capabilities that distinguish it from market competitors. In third-degree price discrimination happens when customers are segregated by . What would have been DTRs debt to equity ratio if the$10 million of stock had not been Oligopoly. Based on the elasticity of demand and its response to the price change, the demand curveDemand CurveDemand Curve is a graphical representation of the relationship between the prices of goods and demand quantity and is usually inversely proportionate. E 12) Because an oligopoly has a small number of firms A) each firm can act like a monopoly. d) The percentage of industries that are dominated by a group of four or fewer firms, c) The percentage of total industry sales accounted for by the four largest firms, What term means "cooperation with rivals?" As their products seem visually identical, both the brands have to make sure they offer customers something that the other does not. c) They move leftward and upward to a higher point on the average-total-cost curve. c) it will prevent a price war The firms comprise an oligopolistic market, making it possible for already-existing smaller businesses to operate in a market dominated by a few. a) purely competitive market c) Dominant firms How oligopolists react to the price change by one firm can be best understood with the downward-sloping Kinked demand curve. 4) Which one of the following industries is the best example of an oligopoly? Which of the following is not a characteristic of an oligopoly? ), Which of the following is true about the oligopolist if rivals match a price cut but ignore a price increase? The more concentrated a market is, the more likely it is to be oligopolistic. D) payoffs When firm X increases its price. Required fields are marked *. . A duopoly is Its main characteristics are discussed as follows: 1. 14) A duopoly occurs when ________. 14) The kinked demand curve model The payoff matrix of economic profits above displays the possible outcomes for Bob and Jane who are involved in game of whether or not to advertise. A cartel is a group of producers of goods or suppliers of services formed through an agreement amongst themselves to regulate the supply of goods or services with the basic intent to illegally regulate the prices or restrict competition regarding the said goods or services. a- Compute the Cournot equilibrium total quantity, price, quantity for each firm, and . . What is it called when firms reach a verbal or tacit agreement with rivals about price in a social setting like the golf course? Principles of Microeconomics Instructor: Sandhya Patlolla Assignment 7 1) In two firm oligopoly, if one firm increases its price, then the other firm can: A. 13) A dominant firm oligopoly might be one for which the Herfindahl-Hirschman Index is 18) A market with a single firm but no barriers to entry is known as D) All of the above. It is the most important feature of an oligopolistic market. d. It is difficult to enter an oligopoly industry and compete as a small start-up company. Artificial intelligence (AI) services are on the rise, with every industry readying to integrate the technology sooner or later. The firms produce differentiated products. Oligopolies are typically composed of a few large firms. d) Firms choose strategies at the same time. Are oligopolies dynamically efficient? Explained by Sharing Culture It is calculated by dividing the change in the costs by the change in quantity. Mutual interdependence among the firms in decision making is the essential feature of the oligopolistic market. A game that is played more than once between rivals is a ____ (Enter one word) game. *Cause price wars during business recessions Ficha de una obra (2).docx - Ficha de una obra Autor: 6) According to the kinked demand curve theory of oligopoly, at the quantity corresponding to the kink, the firm's 8 8 which is not a characteristic of oligopoly a each - Course Hero C) other firms will raise their prices by an identical amount. Though, it is rare to find pure oligopoly situation, yet, cement, steel, aluminum and chemicals producing industries approach pure oligopoly. c) Its marginal cost curve is made up of two segments E) marginal cost. a) its rivals do not respond to either a price cut or price increase e) Price leadership model, In the _______ model of oligopoly, firms react to price decreases but ignore price increases by other firms. D) perfectly inelastic. B) there are two producers of two goods competing in an oligopoly market *Prohibit the entry of new rivals. Each firm is so large that its actions affect market conditions. Which statement is true about oligopolies? It encourages existing brands to improve product quality and originality by instilling a sense of rivalry. a) greater than or equal to 40% b) Interindustry competition O B. As in an oligopoly market, the decision of one firm influences the process and working of another firm. a) The kinked-demand curve model 13) Complete the following sentence. *speeding up technological progress It is a reflection of quantity/output performance against cost/revenue performance. e) low to receive a payout of $8. Interdependence: The foremost characteristic of oligopoly is interdependence of the various firms in the decision making. *Increase profits It is assumed that all of the sellers sellidentical or homogenous products. a) its rivals collude b) Lower prices, but greater output The value denotesthe marginalrevenue gained. d) Its marginal revenue curve would consist of two segments, d) Its marginal revenue curve would consist of two segments But the other firms act considering the interdependence. b) collusion C) Art denies and Bob confesses. E) a cartel. 6) Wal-Mart follows the kinked demand curve model of oligopoly. a) are always more efficient A market is considered to be a(n) ______ when the largest four firms in an industry control more than 40% or more of the market. E) the firms are interdependent. Oligopolistic behavior implies that oligopolists prefer competition ______. B) a market where two firms compete for profit and market share. *localized markets, *dominant firms b) Collusive pricing model C) if Jane does not change her decision, Bob would like to change his. A) collusion of the participants leads to the best solution from their point of view. b) Strategies are chosen for a single time period. C. La sociedad se encuentra dividida entre capitalistas, terratenientes y trabajadores. Oligopolistic firms do which of the following when they change their pricing strategies? d) They do not achieve allocative efficiency because their price exceeds marginal cost. Oligopolies are typically composed of a few large firms. When the negotiations began, DTR had debt of$80 million and equity of $50 million. xxx\underline{\phantom{\text{xxx}}}xxx. E) specify what happens if costs change. For example, when a government grants a patent for an invention to one firm, it may create a monopoly. In second-degree price discrimination the monopolist offers a menu of quantity-based pricing options designed to induce customers to self-select based on how highly they value the product.
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