Refer to Scenario 12.2. In this game, if both players end up playing their weak strategies, then

Bob is the only carpet installer in a small isolated town. The above figure shows the demand curves of two distinct groups of customers-residential and business. Bob is likely to price discriminate because

A) elasticities differ across markets. B) the installation of carpets cannot be resold. C) Bob can probably identify which consumers belong to which segment. D) All of the above.

Which of the following is a major criticism of a monopoly as a cause of allocative inefficiency?

a. A monopolist fails to expand output to the level where the consumers' evaluation of an additional unit is just equal to its opportunity cost b. A monopolist has no incentive to produce efficiently, because even if it pays no attention to the costs of production, it will be guaranteed an economic profit c. A monopolist will always make profits therefore providing an incentive to keep prices at the level that maximizes consumer surplus d. A monopolist has an advantage because it can purchase the resources in a competitive market e. Consumer surplus would no longer be equal to producer surplus