Reference no: EM13713357

One of the key differences the makers of the iPhones and the Samsung smartphones utilize as a part of a monopolistic competition is

licenses
patents
product differentiation
limited liability

Refer to the above payoff matrix for profits (in millions) of Orange Inc. and Grape Inc. and their two strategies. Which of the following is true regarding the game?

Only Orange Inc.  has a dominant strategy
Both companies have a dominant strategy
Neither companies has a dominant strategy
Only Grape Inc.  has a dominant strategy

Refer to the above payoff matrix for profits (in millions) of Orange Inc. and Grape Inc. and their two strategies. If Grape Inc. charge a high price and Orange Inc. charge a low price, then Grapr Inc. will gain profit of ______ million and Orange Inc. will gain profit of ______ million. 

1000; 300
800; 800
500; 500
300; 1000

If firms in the industry are experiencing short-run losses, we can expect that _____ in the long run.

Some firms will exit the industry.
New firms will enter the industry
The provided information is not enough to get the answer.
The equilibrium price will not change.

Refer to the above payoff matrix for profits (in millions) of Orange Inc. and Grape Inc. and their two strategies. Which of the following is the outcome of the dominant strategy without cooperation?

Both Orange Inc. and Grape Inc. choose the low price.
Orange Inc. chooses low price and Grape Inc. choose the high price
Both Orange Inc. and Grape Inc. choose the high price.
Orange Inc. chooses high price and Grape Inc. choose the low price

Which of the following is not the reason why cartels are unstable?

Individual members may want to cheat.
One firm's action will affect other firms.
One of firms can earn more money by producing more than its output quota.
Firms cannot foresee the price, which will lead to make wrong decision and low the profit.

Which formula do you use when calculating the total profit?

ATC*Q
P*Q
(P-MR)*Q
(P-ATC)*Q

Which of the following is true about three major types of price discrimination?

In second-degree price discrimination, monopoly firms increase in producer surplus comes from consumers in the forms of higher prices.
In third-degree price discrimination, monopoly firms increase in producer surplus comes from consumers in the forms of higher prices.
In first-degree price discrimination, monopoly firms increase in producer surplus comes from the reduction in deadweight loss.
In first-degree price discrimination, monopoly firms use their market power to increase their producer surplus.