D. All of the above

E. None of the above

38. A profit-maximizing monopolist practicing price discrimination will charge the lowest price in the market where demand

A. Is most price-elastic

B. Is least price-elastic

C. has unit price-elasticity

D. Is highest

E. Is most price-inelastic

39. Monopolistic competition differs from perfect competition in that:

A. Some attribute of the product or the firm itself is differentiated across firms

B. Firms exercise some market power

C. Firms have to account for their rivals' response to their decisions

D. More than one of the above is correct

E. All of the above is correct

40. The net result of the Prisoner's Dilemma, when applied to a situation involving two oligopolists, is that

A. One of the firms makes a profit and the other firm incurs a loss

B. Neither firm makes a profit and both leave the industry

C. Prices will be above the level implied by joint profit maximization

D. Prices will be below the level implied by joint profit maximization

E. Joint profits will be maximized

41. Which of the following could constitute a case of strategic entry deterrence?

A. The incumbent accounts for the expected moves of the entrant and uses that information to maximize own profits

B. The incumbent invests into production to make more profit before its market share is contested by an entrant

C. The incumbent forgoes some of the current profit in favour of better opportunities in case of possible a price war

D. The entrant cannot observe any actions of the incumbent, which makes it reluctant to enter the market as to avoid possible losses

E. The entrant deceives the incumbent into underestimating his [entrant's] production costs, thus forcing the latter to make excess investment in technology

42. Cournot oligopoly is characterized by:

A. Easy adjustment of prices, thus strategic choice of output

B. Easy adjustment of output, thus strategic choice of prices

C. Equilibrium price at the level of marginal costs

D. Sequential decision-making

E. More than one of the above

43. A typical shop in Bavaria would offer about a hundred brands of local beer. The local beer industry in Bavaria would likely constitute:

A. A perfect competition

B. A monopolistic competition

C. An oligopoly

D. A natural monopoly

E. A discriminating monopoly

44. Consider a small town build around a coal mine which is perfectly competitive in its product market and is the sole employer in the town. Suppose that employment is controlled by a trade union seeking to maximize the total wage bill of its members. Then wages will be determined by:

A. MRPL = w

B. MVPL = w

C. MVPL = MCL

D. MRPL = MCL

E. None of the above

45. Creation of a trade union will typically lead to:

A. A rise in economic rent of insiders

B. A rise in wages of outsiders

C. An increase in labour market efficiency

D. A loss of jobs by insiders

E. Improvement in the overall prosperity

46. A reduction in the wage rate has an income effect, which results in ____ consumption of leisure, and a substitution effect, which results in ____ consumption of leisure.

A. reduced; reduced

Дата добавления: 2015-10-30