9. Breakdown of a cartel agreement Aa Aa
Suppose that there is a town in which only two of the residents, Felix and Crystal, own wells that produce water safe
for drinking, and suppose that Felix and Crystal can pump and sell as much water as they want at
8. The problem of cheating Aa Aa
Mays and McCovey are beer-brewing companies that operate in a duopoly (two-firm oligopoly). The daily marginal
cost (MC) of producing a can of beer is constant and is $0.60 per can. Assume that neither firm had any startup
5. The monopolistic competitor and two types of efficiency Aa Aa
Suppose that a firm produces toy train engines in a monopolistically competitive market. The following graph shows
its demand curve (Demand), marginal revenue curve (MR), marginal cost curve
15. Applications of game theory Aa Aa
Suppose that Fizzo and Pop Hop are the only two firms that sell orange soda. The payoff matrix that follows shows
the profit (in millions of dollars) each company will earn depending on whether or not it advertises. F
11. Oligopoly firms' cartels and game theory Aa Aa
Consider a remote town in which two restaurants, All-You-Can-Eat Cafe and GoodGrub Diner, operate in a duopoly.
Both restaurants disregard health and safety regulations, but they continue to have customer
6. The relationship between MPP and MC Aa Aa
Karen's Burrito Stand is a small restaurant that sells burritos. For Karen, stoves are a fixed input and workers are variable
inputs. Assume that labor is Karens only variable cost. Karen has a total fixed cost
5. Efficiency in the production possibilities model Aa Aa
Suppose China produces wheat and laptops. The following graph shows China's current production possibilities
frontier (PPF), along with six output combinations (black X symbols) labeled A to F.
$=keep the range the same
Population: The set of all elements of interest in a particular study
Sample: A subset of the population
Scatter-Plot: Used to see trends and relationships between two variables graphically
Coefficient of Variation (STDEV/MEAN)*1