Unit 4: Imperfect Competition

Which of the following is more likely to result from a perfectly competitive market structure than from a monopoly making the same product?

Unlike a perfectly competitive firm, a monopoly

Firms with which of the following market structures maximize profits by producing where marginal cost equals marginal revenue, if at all? I. Perfect competition II. Oligopoly III. Monopoly IV. Monopolistic competition

The necessity for a monopoly to lower its price in order to sell more units of its product explains why

In the long run, a monopolistically competitive firm

In this game, a dominant strategy equilibrium

At a Nash equilibrium,

When the opportunity for price discrimination arises,

In order for a firm to successfully carry out price discrimination, which of the following conditions must hold? I. The firm cannot face a downward sloping demand curve. II. The firm must have market power. III. Buyers with differing demand elasticities must be separable. IV. The firm must have motives beyond profit maximization. V. The firm must be able to prevent the re-sale of its products.

A monopolist differs from a perfectly competitive firm because a monopolist

For a monopolist, marginal revenue is less than price because

Compared to a perfectly competitive market, a monopoly results in

Which of the following is a characteristic of monopolistic competition?

What is the profit-maximizing quantity and price for this monopolist?

In long-run equilibrium, a monopolistically competitive firm

An oligopoly is best characterized by

What is the dominant strategy for Firm A?

Price discrimination allows a monopolist to

A perfectly price-discriminating monopolist charges each consumer their maximum willingness to pay. As a result,

In a Nash equilibrium,

What is the Nash equilibrium of this game?

The demand curve facing a monopolistically competitive firm is

A monopolist maximizes profit by producing where MR = MC and then

If firms in a monopolistically competitive market are earning economic profits in the short run, then in the long run

The kinked demand curve model of oligopoly predicts that

Excess capacity in monopolistic competition means that the firm

A monopolist is earning economic profit in the short run. In the long run, the monopolist can maintain these profits because

Government regulation of a natural monopoly that requires the firm to set price equal to marginal cost results in

The prisoners' dilemma illustrates that

If a monopolist is currently producing on the inelastic portion of its demand curve, it can increase total revenue and decrease total cost by

A monopolist faces the demand curve P = 100 − 2Q and has a constant marginal cost of $20. What price and quantity maximize profit?

Compared to a perfectly competitive market, a profit-maximizing monopoly results in

A monopolist faces the demand curve P = 100 - 2Q and has a constant marginal cost of $20. What is the profit-maximizing price and quantity, and what is the deadweight loss compared to perfect competition?

A monopolistically competitive firm is currently producing where MR = MC and is earning positive economic profits. Which of the following describes the long-run outcome for this firm?

Two firms in an oligopoly are considering whether to set high or low prices. If both set high prices, each earns [math]5 million. If one sets high and the other low, the low-price firm earns [math]2 million. What is the Nash equilibrium?