When a Nash equilibrium is reached:
A. the outcome will only change if the "lead" player changes his strategy.
B. no one has an incentive to break the equilibrium by changing his strategy.
C. it must be true that all players have a dominant strategy.
D. None of these statements is true.
B. no one has an incentive to break the equilibrium by changing his strategy.
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If the firms in a monopolistically competitive industry are suffering short-run losses, which of the following will occur in the long run?
a. Some firms will enter the industry. b. Customers of firms that leave the industry will switch to remaining firms. c. Firms that remain in the industry will face reduced demand. d. Firms will continue to incur losses. e. There will be no excess capacity.
If Americans decide to buy more South African diamonds, what is the effect in the foreign market?
a. It will increase demand for U.S. dollars. b. It will decrease demand for U.S. dollars. c. It will increase supply of U.S. dollars. d. It will decrease supply of U.S. dollars.