in a perfectly competitive market, are sellers price givers or price takers
price takers
100
what does cross price elasticity measure
quantity of good 1 to the price of good 2
100
if income elasticity is negative that means the good is
inferior
100
the difference between economic and accounting profit
economic profit includes implicit cost
200
each player in prisoners dilemma will pursue...
their dominant strategy
200
in a perfectly competitive market demand curves are
perfectly elastic
200
for inelastic, if there is a big change in price there is a _____ change in quantity
small
200
the closer the market structure is to being a monopoly, the HIGHER/LOWER is the market concentration
higher
300
name the two markets that have some market power
monopolistic competition, oligopoly
300
what are three characteristics of perfect competition
1. many buyers and sellers
2. goods for sales are identical
3. firms can freely enter/exit the market
300
what is the formula for price elasticity of demand
(Q2-Q1)/[(Q2+Q1)/2]/(P2-P1)/[(P2+P1)/2]
300
name three characteristics of an elastic curve
flatter curve, >1, price sensitive
300
which is more competitive when considering market share 0 or 1000
0
400
T/F in a competitive firm P=MR=AR
True
400
firms maximize profit:
MR=MC
400
what should be held constant when calculating income elasticity
price of the good
400
price elasticity of demand for a good is .25, then a price decrease of 20% results in a...
5 percent increase in Qd
400
what is the difference used in the HHI scale to measure competitiveness?
the market share is squared
500
in competitive markets in the long run what kind of profits do firms earn & what does the curve look like
zero, horizontal
500
draw the graph that shows a short run equilibrium that will encourage entry into a monopolistically competitive market
500
if there is a change in price in a unit elastic product there is what kind of affect on total revenue
none
500
percentage of quantity A is an increase of 2.5 and percentage change in price of good B is a decrease of 1.5... cross price of elasticity is ___ and what relationship exists?
-1.67, complements
500
Equilibrium price = $25
Equilibrium quantity = 100
Fixed cost = $100
VC = $4
what is the profit of this firm?