part ii final eco 550
TRANSCRIPT
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PART II
Question 14 out of 4 points
When there is no Equilibrium (or no Nash Equilibrium), we expect that:Answer
Selected Answer:
a firm will follow a randomized strategy.
Correct Answer:
a firm will follow a randomized strategy.
Question 24 out of 4 points
The Prisoner’s Dilemma involves two spies who are held in separate soundproof
rooms. But even if the two spies could communicate, what makes it difficult for them to
achieve the cooperative solution (both not confessing)?Answer
SelectedAnswer: The problem is that both spies have incentives to double cross each
other.
Correct Answer:
The problem is that both spies have incentives to double cross each
other.
Question 34 out of 4 points
A key to analyzing subgame perfect equilibrium strategy in sequential games isAnswer
Selected Answer:
an explicit order of play for at least some participants
Correct Answer:
an explicit order of play for at least some participants
Question 44 out of 4 points
An illustration of a non-credible commitment is the promiseAnswer
Selected Answer:
to restrain output to the quota assigned by a cartelCorrect Answer:
to restrain output to the quota assigned by a cartel
Question 54 out of 4 points
If one-time gains from defection are always less than the discounted present value of an
infinite time stream of cooperative payoffs at some given discount rate, the decision-
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makers have escapedAnswer
Selected Answer:
the Prisoner's dilemma
Correct Answer:
the Prisoner's dilemma
Question 64 out of 4 points
Firms that have a cover charge for their customers and charge for each item they
purchase as well are exhibitingAnswer
Selected Answer:
two-part price discrimination.
Correct Answer:
two-part price discrimination.
Question 74 out of 4 points
Third-degree price discrimination exists whenever:Answer
Selected
Answer: the seller can separate markets by geography, income, age, etc., and chargedifferent prices to these different groups.
Correct
Answer: the seller can separate markets by geography, income, age, etc., and charge
different prices to these different groups.
Question 84 out of 4 points
Which of the following pricing policies best identifies when a product should be
expanded, maintained, or discontinued?Answer
Selected Answer:
marginal-pricing policy
Correct Answer:
marginal-pricing policy
Question 94 out of 4 points
The segmenting of customers into several small groups such as household, institutional,
commercial, and industrial users, and establishing a different rate schedule for each
group is known as:Answer
Selected Answer:
third-degree price discrimination
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Correct Answer:
third-degree price discrimination
Question 104 out of 4 points
The following are possible examples of price discrimination, EXCEPT:Answer
SelectedAnswer: a product sells at a higher price at location A than at location B, because
transportation costs are higher from the factory to A.
CorrectAnswer: a product sells at a higher price at location A than at location B, because
transportation costs are higher from the factory to A.
Question 114 out of 4 points
Which of the following are not approaches to resolving the principal-agent problem?Answer
Selected Answer:
straight salary contracts
Correct Answer:
straight salary contracts
Question 124 out of 4 points
Vertical integration may be motivated by all of the following except:Answer
Selected Answer:
Economies of ever wider spans of managerial control
Correct Answer:
Economies of ever wider spans of managerial control
Question 134 out of 4 points
When borrowers who do not intend to repay are able to hide their bad credit histories, a
lender's well-intentioned borrowers shouldAnswer
Selected Answer:
offer more collateral in exchange for lower interest charges
Correct Answer:
offer more collateral in exchange for lower interest charges
Question 144 out of 4 points
Contracts are distinguished from tactical alliances by which of the followingcharacteristics:Answer
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Selected Answer:
require third-party enforcement
Correct Answer:
require third-party enforcement
Question 15 4 out of 4 points
To accomplish its purpose a linear profit-sharing contract mustAnswer
Selected Answer:
establish a separating equilibrium
Correct Answer:
establish a separating equilibrium
Question 164 out of 4 points
The ____ is equal to the some of the squares of the market shares of all the firms in anindustry.Answer
Selected Answer:
Herfindahl-Hirschman index
Correct Answer:
Herfindahl-Hirschman index
Question 170 out of 4 points
The sentiment for increased deregulation in the late 1970's and early 1980's has been felt
most significantly in the price regulation ofAnswer
Selected Answer:
automobiles
Correct Answer:
transportation
Question 184 out of 4 points
The lower the barriers to entry and exit, the more nearly a market structure fits the ____
market model.Answer
Selected Answer:
perfectly contestable
Correct Answer:
perfectly contestable
Question 194 out of 4 points
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____ yields the same results as the theory of perfect competition, but requiressubstantially fewer assumptions than the perfectly competitive model.Answer
Selected Answer:
The theory of contestable markets
Correct Answer:
The theory of contestable markets
Question 204 out of 4 points
The antitrust laws regulate all of the following business decisions except ____.Answer
Selected Answer:
wage levels
Correct Answer:
wage levels
Question 214 out of 4 points
In cost-effectiveness analysis, constant cost studies:Answer
Selected
Answer: attempt to specify the output which may be achieved from a number ofalternative programs, assuming all are funded at the same level
Correct
Answer: attempt to specify the output which may be achieved from a number of
alternative programs, assuming all are funded at the same level
Question 224 out of 4 points
The social rate of discount is best approximated by:Answer
Selected Answer:
the opportunity cost of resources taken from the private sector
Correct Answer:
the opportunity cost of resources taken from the private sector
Question 234 out of 4 points
In the constant-growth dividend valuation model, the required rate of return on commonstock (i.e., cost of equity capital) can be shown to be equal to the sum of the dividend
yield plus the ____.Answer
Selected Answer:
dividend growth rate
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Correct Answer:
dividend growth rate
Question 244 out of 4 points
The ____ method assumes that the cash flows over the life of the project are reinvested
at the ____.Answer
Selected Answer:
net present value; firm's cost of capital
Correct Answer:
net present value; firm's cost of capital
Question 254 out of 4 points
Which of the following should not be counted in a cost-benefit analysis?Answer
Selected Answer:
pecuniary benefits
Correct Answer:
pecuniary benefits
Tuesday, December 9, 2014 7:25:41 PM EST