If a duopoly has reached the monopoly outcome and only one firm increases its production, that firm's profit ________ and the other firm's profit ________
A) increases; increases
B) increases; decreases
C) decreases; increases
D) decreases; decreases
E) increases; does not change
B
You might also like to view...
Refer to the graph below, where Sd and Dd are the domestic supply and demand curves for a product. The world price of the product is $6. If this market were closed to international trade, the total revenue that would go to domestic producers would be:
A. $600, but only $240 if the domestic market were open to international trade
B. $600, but only $120 if the domestic market were open to international trade
C. $500, but only $240 if the domestic market were open to international trade
D. $240, but only $120 if the domestic market were open to international trade
"A country can be worse off as a result of free trade in an exported product if there are no policies that force market decision-makers to internalize the external costs associated with the domestic production of this product." Do you agree or disagree with the statement? Illustrate your answer with the help of relevant diagrams.
What will be an ideal response?