Exam 11: Monopolistic Competition, Oligopoly, and Game Theory

Exhibit 24-3 Refer to Exhibit 24-3. Which of the following points represents the profit-maximizing quantity and price of a monopolistic competitor?

The excess capacity theorem states that a monopolistic competitor

One of the assumptions of the theory of monopolistic competition is that all firms in the industry produce and sell a homogenous product.

Exhibit 24-7 Refer to Exhibit 24-7. A monopolistic competitive firm earns a total profit of __________ when it produces the profit maximizing level of output.

Which of the following statements is  false ?

Which of the following assumptions applies to both perfect competition and monopolistic competition?

In the real-world, which of these industries is most clearly an oligopoly?

For a monopoly firm, price is __________ marginal revenue, and for a monopolistic competitive firm, price is __________ marginal revenue.

Exhibit 24-10 Suppose that the letter grade earned on a test for each student in a class depends upon how well he\she does relative to other students in the class.  This exhibit shows a prisoner's dilemma setting for two representative students in the class, George and Gina. Refer to Exhibit 24-10.  If Gina studies for two hours and George studies for four hours, George's letter grade on the test will be a ___________ and Gina's letter grade on the test will be a __________________.

An industry is composed of 20 firms, all with equal sales. The eight-firm concentration ratio in this industry is

Suppose an industry is made up of 22 firms. Two firms each sell 10.5 percent of the industry's total output; another three firms each sell 9 percent; another six firms each sell 5 percent; and the last eleven firms each sell 2 percent. What is the eight-firm concentration ratio in this industry?

The monopolistic competitive firm will most likely earn a normal profit in the long run because of