Bertrand price competitors can recover some market power when they differentiate their products.
Answer the following statement true (T) or false (F)
True
Rationale: In the absence of product differentiation, the Bertrand competitors lose market power and price at MC. But with product differentiation, they can price above MC and thus recover some market power.
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The figure above shows Diane's demand curve for soda. The price of a soda is $1.00. Diane's consumer surplus from her 10th soda is
A) $0.00. B) $0.50. C) $1.00. D) $1.50. E) $2.50.
According to the Justice Department and the Federal Trade Commission, a merger would likely be challenged if
A) the post-merger industry has an HHI above 1,500 and the HHI rises by more than 100. B) the post-merger industry has an HHI above 500 and the HHI rises by more than 50. C) the number of firms in the post-merger industry is very large. D) the firms' markets are very large.