Samp_Exam3

Samp_Exam3 - SAMPLE EXAM 3 ECON 80A Microeconomic Theory...

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SAMPLE EXAM 3 ECON 80A Professor: Paroma Sanyal Microeconomic Theory 126 Sachar Bldg. Brandeis University (781) 736-2268 Spring 2009 psanyal@brandeis.edu Total 100 points Section 1: Multiple Choice Questions (2 points each) (10 points) 1.The strategy for the Stackelberg Leader is A) to sell a marginally higher quantity of goods than the rival. B) to sell at a marginally lower price than the rival. C) collusion. D) to take account of the effect of its own behavior on the rival firm's quantity choice. 2.If two tit-for-tat players interact together over an infinite period of time, the result will be A) cooperation. B) defection. C) marginal cost pricing. D) a leader will emerge as in the Stackelberg model. 3. Bertrand duopolists face a market demand curve given by P = 90 - Q where Q is total market demand. Each firm can produce output at a constant marginal cost of 30 per unit. The equilibrium price and quantity for the total market will be: A) Q = 30, P = 60. B) Q = 60, P = 30. C) Q = 40, P = 50. D) Q = 45, P = 45. E) none of the above. 4.In the Cournot model A) each firm takes the quantities produced by its rivals as given. B) each firm takes the prices charged by its rivals as given. C) one firm plays a leadership role and its rivals merely follow. D) prices are higher and quantities are slightly less than we would see if the firms colluded. 5.Oligopoly is a market structure in which
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Samp_Exam3 - SAMPLE EXAM 3 ECON 80A Microeconomic Theory...

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