A lake supports a delicious variety of fish. The land around the lake is owned by two fisherman, so by state law both are free to fish as much as they like. Let FA and FB be the number of fish each catches, respectively. Suppose the price of fish is 100 - FA - FB. Given this demand curve, it turns out that marginal revenue is 100 - 2FA - FB for fisherman A and 100 - FA - 2FB for fisherman B. What
is the total number of fish by both in the Nash equilibrium?
a. 30
b. 45
c. 60
d. 90
a
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The success of a cartel rests upon
A) inducing all members to limit their combined output and charge the same price. B) inducing all members to differentiate their products and charge different prices. C) making exit from the cartel as nearly costless as possible. D) discouraging some firms in the market from joining.
The aggregate demand curve indicates the relationship between:
a. the real wage rate and the quality of resources demanded by producers of goods and services. b. the interest rate and the amount of loanable funds demanded by borrowers. c. the natural rate of unemployment and the demand for goods and services when the economy is in long-run equilibrium. d. the general price level and the aggregate quantity of goods and services demanded.