Refer to the diagram. At output level Q 1:
A. resources are overallocated to this product and productive efficiency is not realized.
B. resources are underallocated to this product and productive efficiency is not realized.
C. productive efficiency is achieved, but resources are underallocated to this product.
D. productive efficiency is achieved, but resources are overallocated to this product.
B. resources are underallocated to this product and productive efficiency is not realized.
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Early developers within a given industry benefit from economies of scale, in that they are able to
a. produce larger volumes at a lower cost. b. shape the product based on what the consumer wants. c. avoid competition by creating a monopoly. d. start big instead of having to start small.
Player 1 and Player 2 are playing a game in which Player 1 has the first move at A in the decision tree shown below. Once Player 1 has chosen either Up or Down, Player 2, who can see what Player 1 has chosen, must choose Up or Down at B or C. Both players know the payoffs at the end of each branch. 
Suppose Player 1 and Player 2 enter into a binding agreement in which Player 1 agrees to pay Player 2 a fixed amount of money to get Player 2 to play Up when it is Player 2's turn. How much will Player 1 have to pay Player 2 to get Player 2 to play Up?
A. at least $20. B. at least $50. C. at least $10. D. $0