econ 42

 
1.
One of the basic differences between social and economic regulations is that

2.
There is no incentive for additional producers of an information product to enter the industry when the price charged for these products by each firm already in the industry is equal to

3.

A market situation in which there are a few firms which recognize their mutual interdependence is                        

4.
In which market structure will a firm refuse to shut down when price is less than average

variable cost?

5.
A firm typically achieves its position as a monopolist as a result of

6.
For years, your neighbor insisted she had no desire to own a computer. Recently, however, she purchased one and says she did so because all her relatives have computers and she wants to exchange e-mail with them. Your neighbor’s behavior is an example of

7.
In equilibrium, which of the following conditions is common to both unregulated monopoly and pure competition?

8.
Behavior on the part of the firm that allows it to comply with the letter of the law but violate the spirit reducing the law’s effect is

9.
For a firm to be able to price discriminate it must

10.
As the definition of products narrows (i.e., becomes more specific), the concentration ratio

11.
Establishing different prices for similar products to reflect differences in marginal cost in providing those goods to different groups of buyers is

12.
The industry concentration ratio measures the

13.
The prisoners’ dilemma is a game in which

14.
Suppose an industry has total sales of $25 million per year. The two largest firms have sales of $6 million each, the third largest firm has sales of $2 million, and the fourth largest firm has sales of $1 million. The four-firm concentration ratio for this industry is

15.
Price leadership (parallel pricing) occurs when

16.
A simple way of describing the social cost of monopoly is to say that it

17.
In a monopolistically competitive market there are

18.
When a monopolist sells the same product at different prices and the prices are not related to cost differences, we have

19.
Compared to a perfectly competitive firm, in a long run the monopolistically competitive firm

will have

 
20.
An example of tacit collusion is

21.
Which of the following is not true about a comparison between a perfectly competitive firm and a monopolistically competitive firm?

22.
Suppose two firms are in a game situation and they each must decide on a strategy regarding whether to select a high price or a low price. Profits for a firm are highest when it selects a low price while the other selects a high price; profits are lowest if one selects a high price while the other selects a low price; and profits are in between when both select low prices; and profits are slightly higher when both select high prices. In the absence of collusion we expect

23.
Switching costs refer to

24.
The advertisement approach that allows a consumer to follow up directly to an advertising message is known as

25.
Which of the following statements is true?

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