Chapter 17, Oligopoly Video Solutions, Principles of Microeconomics

Problem 1

The key feature of an oligopolistic market is that
a. each firm produces a different product from other
firms.
b. a single firm chooses a point on the market
c. demand curve.
c. each firm takes the market price as given.
d. a small number of firms are acting strategically.

Aanand Shah

Numerade Educator

02:03

Problem 2

If an oligopolistic industry organizes itself as a coop-
erative cartel, it will produce a quantity of output that

is ________ the competitive level and ________ the monopoly level.
a. less than, more than
b. more than, less than
c. less than, equal to
d. equal to, more than

Aanand Shah

Numerade Educator

02:45

Problem 3

If an oligopoly does not cooperate and each firm
chooses its own quantity, the industry will produce a
quantity of output that is ________ the competitive
level and ________ the monopoly level.
a. less than, more than
b. more than, less than
c. less than, equal to
d. equal to, more than

Aanand Shah

Numerade Educator

02:59

Problem 4

As the number of firms in an oligopoly grows large,
the industry approaches a level of output that is
________ the competitive level and ________ the
monopoly level.
a. less than, more than
b. more than, less than
c. less than, equal to
d. equal to, more than

Aanand Shah

Numerade Educator

01:13

Problem 5

The prisoners' dilemma is a two-person game illus-
trating that
a. the cooperative outcome could be worse for both
people than the Nash equilibrium.
b. even if the cooperative outcome is better than the
Nash equilibrium for one person, it might be worse
for the other.
c. even if cooperation is better than the Nash equilib-
rium, each person might have an incentive not to
cooperate.
d. rational, self-interested individuals will naturally
avoid the Nash equilibrium because it is worse for
both of them.

Dave Kratz

Numerade Educator

02:42

Problem 6

The antitrust laws aim to
a. facilitate cooperation among firms in oligopolistic
industries.
b. encourage mergers to take advantage of economies
of scale.
c. discourage firms from acting in ways that reduce
competition.

Aanand Shah

Numerade Educator