A Big Mac costs $4.00 in the United States and 9.00 reals in Brazil. If the exchange rate is 2 reals per dollar, what is the dollar cost of a Big Mac in Brazil?

If a strategy is a best response, then

A) it will never be played. B) it will never be part of a Nash equilibrium. C) A and B are correct. D) it could be part of a Nash equilibrium.

For a perfectly competitive market in which firms face an identical constant marginal costs, the amount of consumer surplus increases if

A. market demand increases. B. marginal cost increases. C. market demand decreases. D. none of these: insufficient information to answer.