Econ1101_W10(1) - Econ 1101 Microeconomics Thinking...

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Econ 1101 Microeconomics Thinking Strategically Lecturer: Scott French Reading: Frank, Jennings, & Bernanke Ch. 11 26/09/2011 1 Econ 1101 - Microeconomics
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Outline Monopolistic competition Game theory What is a game? Payoff matrix for a two-player game Nash equilibrium The prisoner’s dilemma The behaviour of oligopoly firms 26/09/2011 2 Econ 1101 - Microeconomics
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Monopoly vs. Monopolistic Competition Monopoly 1 firm 1 unique product Barriers to entry 26/09/2011 Econ 1101 - Microeconomics 3 Monopolistic Competition Many firms Differentiated products Free entry and exit
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Monopolistic Competition Long-run equilibrium 26/09/2011 Econ 1101 - Microeconomics 4 ATC MC D P Q 0 24 18 12 6 1 2 3 4 5 MR
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Is the long-run monopolistically competitive equilibrium efficient? P<MC Unexploited economies of scale But, the cost of increasing efficiency is a decrease in variety. 26/09/2011
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This note was uploaded on 10/20/2011 for the course COMMERCE 3502 taught by Professor All during the One '11 term at University of New South Wales.

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Econ1101_W10(1) - Econ 1101 Microeconomics Thinking...

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