Quiz 5 F2000 - Economics 2G03/2X03 Fall 2000 Sections 1 & 2...

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Economics 2G03/2X03 Fall 2000 Quiz 5 Total Marks = 70 Instructor: Fred Aswani November 22 nd 2000 Part A (25 Marks- 5 marks each) 1. Suppose 3 firms compete as in the Cournot model. Each has an identical total cost function TC = 100y i . The market inverse demand curve is p = 500-y Each firm will produce: a. 66.67 units of output b. 100 units of output c. 20 units of output d. An unknown number of units of output e. 50 units of output 2. The profits for each firm in question 1 above will be a. 30,000 b. 20,000 c. 10,000 d. None of the above e. Cannot be determined 3. Two firms in a collusive duopoly that have an identical and constant MC will each produce a. The competitive output b. One-half of the monopoly output c. The monopoly output d. One-half of the competitive output e. Any of the above 4. As the number of firms in a Cournot oligopoly gets large a. Output produced by each firm increases b. Industry output increases, and price falls to the competitive level c. The market price approaches the collusive price d. The Oligopolists behave in a more collectively rational manner 1
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5. The name and number of this course is:
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This note was uploaded on 06/18/2011 for the course ECON 2X03 taught by Professor Jamesbruce during the Spring '10 term at McMaster University.

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Quiz 5 F2000 - Economics 2G03/2X03 Fall 2000 Sections 1 & 2...

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