Economics MCQs

Page No. 310

A situation in which oligopolists interacting with one another each choose their best strategy given the strategies that all the other oligopolists have chosen is known as a ?


aNash equilibrium

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bdominant strategy.

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ccartel

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dcollusion solution

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View Answer Nash equilibrium

When a oligopolist individually chooses its level of production to maximize its profits it charges a price that is ?


a more than the price charged by either monopoly or a competitive market

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bless than the price charged by either monopoly or a competitive market

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cmore than the price charged by a monopoly and less then the price charged by a competitive market

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dless than the price charged by a monopoly and more than the price charged by a competitive market

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As the number of sellers in an oligopoly grows larger, an oligopolistic market looks more like ?


a monopoly

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b a competitive market

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cmonopolistic competition

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da collusion solution

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If oligopolists engage in collusion and successfully from a cartel, the market outcome is ?


athe same as if it were served by competitive firms.

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befficient because cooperation improves efficiency

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c the same as if it were served by a monopoly.

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dknown as a Nash equilibrium

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The market for hand tools (such as hammers and screwdrivers) is dominated by Draper Stanley, and Craftsman This market is best described as ?


amonopolistically competitive

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ba monopoly

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can oligopoly

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dcompetitive

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View Answer an oligopoly

In cartels ?


aEach individual firm profit maximizes

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bThere may be an incentive to cheat

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cThe industry as a whole is loss making

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dThere is no need to police agreements

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Firms in oligopoly are likely to ?


aInvest heavily in branding

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bAct independently of other firms

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cTry to differentiate its products

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dTry to be a price maker

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In Game Theory ?


a Firms are assumed to act independently

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bFirms are assumed to cooperate with each other

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cFirms collude as part of cartel

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d Firms consider the actions of others before deciding what to do

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In the kinked Demand Curve theory it is assumed that ?


aAn increase in price by the firm is not followed by others

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bAn increase in price by the firm is followed by others

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c A decrease in price by the firm is followed by others

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dFirms collude to fix the price

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If a few firms dominate an industry the market is known as ?


amonopolistic competition

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bCompetitively monopolistic

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cDuopoly

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d Oligopoly

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View Answer Oligopoly

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