Your willingness to pay more to fly to your vacation spot on the coast rather than incur the cost of driving there indicates that:

The Nash equilibrium in a Bertrand game in which firms produce perfect substitutes and have equal marginal costs is:

a. efficient because all mutually beneficial transactions will occur. b. efficient because of the free entry assumption. c. inefficient because some mutually beneficial transactions will be foregone. d. inefficient because of the uncertainties inherent in the game.

Which of the following statements explains increasing returns to scale? a. A larger firm can produce at a higher average total cost than a smaller firm. b. A larger firm can produce at a lower average total cost than a smaller firm

c. A larger corporation has lower opportunity costs than a smaller corporation. d. The cost of production for each unit of good in a small firm always increases as output increases.