The game theory takes into consideration:
Reaction of rival firms
Reactions of people
No reaction of rival firms
None of the above
Correct Answer :
A. Reaction of rival firms
Related Questions
Even in the long-run equilibrium, the pure monopolist can make abnormal profits because of:
Advertising
His low LAC
Blocked entry
High price he charges
If the demand curve remains unchanged and supply increases, the price will:
Rise
Fall
Remain the same
None of the above
If a new production technology for producing compact discs is developed and new firms are attracted to this field:
The supply curve will shift down or right
The supply curve will shift up or left
Both demand and supply curve shifts would occur
None of the above
The external economies of scale experienced by a firm include the:
Growth of firms processing its waste materials
Development of research bureau serving the industry
Supply of suitable skilled labor in the area
All of the above
The concept of product differentiation was firstly introduced by:
Smith
Kaldor
Sraffa
Marshal
Which of the following conditions is met in the long-run equilibrium in monopolistic competition, where the firm is earning only normal profits?
MC =AC and P
MC = AC and P=MR
P =MC and P
MC=MR and P =AR= ATC
Quantity demanded or supplied is measured in:
Monetary units
Physical units
Relative units
Constant units
In which case the elasticity shown by the different points of a curve is the same?
A straight line curve
A downward sloping demand curve
A rectangular hyperbola demand curve
None of the above
In Nash equilibrium, a player:
Deviates from his strategy
Does not deviate from his strategy
Does not think in a good way
None of the above
General equilibrium is concerned with simultaneous equilibrium of:
Few economic agents
All the economic agents
Two economic agents
Many economic agents
A monopolist is:
Price winner
Price searcher
Price taker
Price leaver
In context of oligopoly, the kinky demand curve (kinked demand curve) hypothesis is designed to explain:
Price and output determination
Price rigidity (price stickness)
Price leadership
Collusion among rivals
If we measure the elasticity of demand with the help of the average and marginal revenue, the formula is:
Ed = AR/ (AR- MR)
Ed = MR/ (AR-MR)
Ed = AR/(MR-AR)
Ed = AR/ MR
If as a result of an increase in prices, total outlay (expenditures) on a commodity decreases, its price-elasticity of demand is:
Perfect elastic (infinitely elastic)
Relatively elastic (greater than one elasticity)
Unit elastic
Relatively inelastic (less than one elasticity)
Market allocation fundamentally relies upon:
A system of relative prices
A belief that employees work for the good of society
Government ownership of the means of production
Moral incentives to encourage productive efficiency
The optimal strategy for a player is termed as:
Recessive strategy
Dormant strategy
Dominant strategy
Hidden strategy
The greater the percentage of income spent on a commodity:
The greater its elasticity is likely to be
The weaker its elasticity is likely to be
The unchanged its elasticity is likely to be
None of the above
The slope of budget line shows the price ratios of:
Many goods
Few goods
Two goods
Three goods
Dumping is international discriminating:
Monopoly
Oligopoly
Duopoly
None of the above
The advertisement and other selling activities:
Lessen the differentiation
Widen the differentiation
Does not effect the differentiation
All of the above
The cost curves of the firm shift due to changes in:
Input prices
Technological innovations
Both of them
None of them
A budget line shows:
Quantities of commodity X which a consumer could buy with no amount of Y
Quantities of commodity Y which a consumer could buy with no amount of X
The different combinations of X and Y that the consumer could buy
All of the above
An individual consumers demand is not determined by:
Price of the commodity
Price of the substitutes
His household income
Size of countrys population
In case of monopoly, both AR and MR fall, but MR falls:
Double to that of AR
1/2 to that of AR
2/3 to that of AR
Four times to that of AR
A monopolist is able to maximize his profit when:
His output is maximum
He charges a high price
His average cost is minimum
His marginal revenue is equal to marginal cost
According to the principle of substitution?
Many goods have no effective substitutes
Nearly all goods have substitutes
The prices of substitute goods must be the same
Buyers will stop buying a good if its price rises
When elasticity of demand is less than one (e<1), then following the formula MR=P[1-1/e], the MR will:
Positive
Negative
Zero
None of the above
If demand is elastic and supply is inelastic then the burden of a tax on the good will be:
Borne mostly by producers
Borne mostly by consumers
Borne mostly by government
Shared equally by producers and consumers
At a point below the middle of a straight line demand curve, elasticity of demand is:
Less than one
Equal to one
More than one
Equal to infinity
7.In an economy based on the price system the decision on what shall be produced is made by:
Government
Consumer
Producer
Stock holder