3. Which of the following statements is (are) correct A. If duopo.docx

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3. Which of the following statements is (are) correct? A. If duopolists successfully collude, then their combined output will be equal to the output that would be observed if the market were a monopoly. B. Although the logic of self-interest decreases a duopoly s price below the monopoly price, it does not push the duopolists to reach the competitive price. C. Although the logic of self-interest increases a duopoly s level of output above the monopoly level, it does not push the duopolists to reach the competitive level. D. All of the above are correct. E. B and C, only 4. Which of the following statements about the prisoners dilemma is (are) correct? A. The prisoners dilemma provides insights into the difficulty of maintaining cooperation. B. In the prisoners dilemma game, the logic of self- interest leads to a breakdown of any agreement that the
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Unformatted text preview: prisoners might have made before being questioned. C. Very often, the reason that players can solve the prisoners dilemma game and reach the most profitable � outcome is that the players play the game not once but many times. D. All of the above are correct. E. A and C, only 5. Hot dog vendors on the beach fail to cooperate with one another on the quantity of hot dogs they should sell each day to earn monopoly profits. A consequence of their failure is that, relative to the outcome the vendors would prefer, (x) the price of hot dogs is closer to marginal cost. (y) the quantity of hot dogs supplied is closer to the socially optimal level. (z) the hot dog market at the beach is more competitive. A. (x), (y) and (z) B. (x) and (y) only C. (x) and (z) only D. (y) and (z) only E. (x) only...
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