[Solved] Each Spring,Firm a Brings Out the New Model of Its

Why is it difficult for colluding firms to maintain a cartel? A)Because the large profits made by existing firms result in new firms entering the industry. B)Because cartels are illegal. C)Because cartels always end up producing too little with the result that at least one member firm will find it profitable to raise its price and the other firms will follow. D)Because member firms find the prospect of cheating too attractive to resist.

If the firms in an oligopoly industry are able to successfully form a cartel we would expect the price and output of the cartel to approximate that of which of the following? A)A perfectly competitive industry. B)A monopolistically competitive industry. C)An oligopolistic industry that is similar to the price leadership variant. D)A monopoly.

Of which of the following is OPEC an example? A)A non-colluding oligopoly. B)A cartel. C)A differentiated oligopoly. D)A duopoly.

Which of the following variants of oligopoly theory assume that there is no collusion between firms? A)The price leadership variant only. B)Both the price leadership and the kinked-demand curve variant. C)The price leadership,kinked-demand curve and cartel variants. D)The kinked-demand curve variant only.

Canada Cement,Canadian General Electric and American Airlines are all examples of which variant of oligopoly theory? A)Price Leadership. B)Kinked-demand curve. C)Cartel. D)None of the choices are correct.

-Refer to the graph above to answer this question.What type of market is portrayed in this graph? A)Monopoly. B)Collusive oligopoly. C)Imperfect competition. D)Perfect competition. E)Non-collusive oligopoly.

-Refer to the graph above to answer this question.According to what assumption is the demand curve drawn? A)That rival firms will match any price increase but ignore any price decrease. B)That rival firms will match any price decrease but ignore any price increase. C)That rival firms will ignore any price increase or decrease. D)That rival firms will match any price increase or decrease.

-Refer to the graph above to answer this question.What will be the profit maximizing price? A)P₁. B)P₂. C)P₃. D)P₄. E)P₅.

-Refer to the graph above to answer this question All of the following statements,except one,are true regarding this firm.Which is the exception? A)The firm is realizing an economic profit. B)The firm will be reluctant to increase the price. C)The firm will pass on any increase in costs by increasing the price. D)The firm will be reluctant to decrease the price. E)The present price exceeds the average cost.

Faced with a kinked demand curve,what action will an oligopolist take if the costs of production increase? A)Increase the price B)Decrease the price,but only if the demand is elastic. C)Decrease the price,but only if the demand is inelastic. D)Decrease the price but only if it is a big increase in costs. E)Nothing,unless it is a very big increase in costs.