4 Which of the following are examples of collusion? Choose one or more: A. The two firms in a small rural town that employ most of the people in that area agree to keep wages low. B. The two leading cell phone manufacturers apply the same new technology, which increases productivity for both. C. All the gas stations along the Gulf coast increase their prices after a hurricane devastates communities near the water. D. Three major airlines meet to discuss pricing strategy and as a result prices for airplane tickets rise. E. The menu prices at restaurants in New Buffalo, Michigan, a small lakeside town, increase during the summer months and decline starting November 1.

4 Which of the following are examples of collusion? Choose one or more: A. The two firms in a small rural town that employ most of the people in that area agree to keep wages low. B. The two leading cell phone manufacturers apply the same new technology, which increases productivity for both. C. All the gas stations along the Gulf coast increase their prices after a hurricane devastates communities near the water. D. Three major airlines meet to discuss pricing strategy and as a result prices for airplane tickets rise. E. The menu prices at restaurants in New Buffalo, Michigan, a small lakeside town, increase during the summer months and decline starting November 1.

Principles of Economics (MindTap Course List)

8th Edition

ISBN:9781305585126

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter17: Oligopoly

Section17.2: The Economics Of Cooperation

Problem 2QQ

See similar textbooks

Similar questions

II.2 Companies A and B can compete on advertising or R&D. The profits (in millions of $ million) of the two firms are given in the table below assumig that they play a one-shot simultancous mov game (the profit or firm A is listed first in every cell of the matrix, followed by the profit of firm B): Advertising R&D 50, 25 10, 70 20, 40 60, 35 1. Find the mixed strategy equilibrium. A\B Advertising R&D 2. What are the expected profits for both firms in this equilibrium?
GAME THEORY: Two countries produce oil. The per unit production cost of Country 1 is C1 = $2 and of country 2 it is C2 = $4. The total demand for oil is Q = 40-p where p is the market price of a unit of oil. Each country can only produce either 5 units, 10 units or 15 units. The total production of the two countries in a Nash equilibrium is: A. 10 B. 15 C. 20 D. 25 E. 30
while others Railroad tracks used to come in different widths (also known as gauges). Some railroads used a wider gauge, used a narrower gauge. This caused problems because it meant trains couldn't easily switch tracks; they could only run on one kind of track. Eventually, the railroads all converged on a single gauge, which meany any train could run on any track. This situation could be modeled as what kind of game? O Legend of Zelda Monopoly Chicken Prisoners' Dilemma Coordination game 4
fnan421 WWord Gozden Geç r Gorunum Varc m Ne yaomak steci gnz soy evn 1) Two firms, X and Y, are planning to market their new products. Each firm can develop either TV or Laptop. Market research indicates that the resulting profits to each firm for the alternative strategies are given by the following payoff matrix: FIRM Y TV LAPTOP FIRM X TV 30, 30 50, 35 LAPTOP 40,70 20, 20 A) If both firms make their decisions at the same time and follow maximin (low-risk) strategies, what will the outcome be? B) Suppose both firms try to maximize profits, but Firm X has a head start in planning, and can commit first. Now what will the outcome be? What will the outcome be if Firm Y has a head start in planning and can commit first? I
Consider two industries, each comprising ten firms. In industry A, the largest firm has a market share of 49 percent. The next three firms have market shares of 7 percent each, and the remaining six firms have equal shares of 5 percent each. In industry B, the top four firms share the bulk of the market with 19 percent apiece. The next largest firm accounts for 14 percent, and the smallest five firms equally split the remaining 10 percent of the industry. a. Compute the four-firm concentration ratio and HI for each industry. Compare these measures across the two industries. Which industry do you think truly exhibits a more competitive structure? Which measure do you think gives a better indication of this? Explain. b. Now let the three second largest firms in industry A merge their operations while holding onto their combined 21 percent market share. Recalculate the HI for industry A. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care…
"In an oligopoly game, the greater the number of players who are colluding:" the lower the possibility of cheating. the more elastic the demand curve of the cheater. the higher the payoff received by each player from colluding. the lower will be the profit from cheating.
Why can Q-learning sustain collusion? a. Because collusion maximizes firms' profit. b. Because collusion is the Nash equilibrium of the pricing game, even if it is played only once. c. Because the algorithm takes into account future profits, and learn that price cutting today will lead to price war tomorrow. d. Because firms use the algorithm to communicate with each other and sustain collusion. 21 Suppose a platform tries to recommend the best movie to Ann and Ben. Movie 1's quality is uniformly distributed from 0 to 1. Movie 2's quality is uniformly distributed from 0.5 to 1. Suppose the platform recommends a movie to Ann and Ben at the same time. What are the expected quality of movie 1 and 2, and which one should it recommend? a. 0.5, 0.5, movie 1. b. 0.75, 0.5, movie 1. c. 0.5, 1, movie 2. d. 0.5, 0.75, movie 2.
fnan421 - Word Teri Gozden Geçir Görünum Yardım Ne yapmak istediğinizi soyleyin 2) Two firms, X and Y, are planning to market their new products. Each firm can develop TV, Laptop. Market research indicates that the resulting profits to each firm for the alternative strategies are given by the following payoff matrixi FIRM Y TV LAPTOP PHONE FIRM X TV 30, 30 50, 35 20, 50 LAPTOP 40,70 20, 20 50,80 PHONE 50,20 80,50 10,10 A) What will be the equilibrium if Firm X makes its selection first? If Firm Y goes first? ; (Ctrl) -
Two bookstores, Barne's Books and Jenson Reads, are competing for customers. Barne's could run no promotion (first row), a "get three books for the price of one" deal (second row), or give away a free copy of "Math Jokes 4 Mathy Folks" with every purchase (third row). Jenson's, on the other hand, could run no promotion (first column), a "get two books for the price of one" deal (second column), or a "get three books for the price of two" deal (third column). Based on this knowledge, the big-wigs at Barne's come up with the following payoff matrix (where each entry represents the number of customers, in thousands, they expect to gain from Jenson's): 0-60-40 P = 30 20 10 20 0 15 Jenson's let slip that there's a 20% chance of running the "two-for-one" deal and a 40% chance of running the "three-for-two" deal. In light of this information, what strategy should Barne's use, and how many customers should they expect to gain or lose from Jenson?
Who was one who developed duopoly model in the economics??
Belge1 - Word eri Gözden Geçir Görünüm Yardım Ne yapmak istediğinizi söyleyin 1) Two firms, X and Y, are planning to market their new products. Each firm can develop TV, Laptop. Market research indicates that the resulting profits to each firm for the alternative strategies are given by the following payoff matrix ! FIRM Y TV LAPTOP PHONE FIRM X TV 30, 30 60. 35 20, 50 LAPTOP 40,70 20, 20 50,80 PHONE 50,20 80,50 10,10 A) Find the Nash equilibria for this game, assuming that both firms make their decisions at the same time. (explain the decision step by step); B) If each firm is risk averse and uses a maximin strategy, what will be the resulting equilibrium? (explain the decision step by step); C) What will be the equilibrium if Firm X makes its selection first? If Firm Y goes first?:
For the R & D game that Kimberly-Clark(Kleenex) and Procter & Gamble (Puffs) Play. Each firm has two strategies: Do R&D or do not R&D. If neither firm does R&D, Kimberly-Clark makes $30 million and Procter & Gamble makes $70 million. If both does R&D, Kimberly-Clark makes $5 million and Procter & Gamble makes $45 million. if only Procter & Gamble does R&D, it makes $85 million and Kimberly-Clark makes -$10 million, and if only Kimberly-Clark does R&D it makes $85 million and Procter & Gamble makes -$10 million. 7) Create the payoff matrix for this game?