Answer the following statement(s) true (T) or false (F)
1. Social welfare would be increased if a monopolistically competitive industry were replaced with a competitive industry.
2. The Robinson-Patman Act was designed to stop resale price maintenance.
3. It is possible for a firm engaging in predatory pricing to make a profit on the good even thought the price is set artificially low.
4. It is possible to avoid the prisoners' dilemma as long as the interaction is repeated and has a definite ending date.
5. Fair trade refers to the fact that retailers are free to set their price in the absence of resale price maintenance.
1. False
2. False
3. False
4. False
5. False
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People often make economic decisions they later regret, which shows
A) they failed to acquire additional information up to the point where expected marginal benefit equals expected marginal cost. B) they failed to behave rationally. C) they failed to invest as much as they ought to have invested in information. D) none of the above.
"Tit-for-tat" is
A) a form of prisoner's dilemma. B) the process in which games find equilibrium. C) a way to enforce a cooperative game. D) a child's game.