The Competition Bureau in Canada wants to increase competition and reduce monopoly power. Thus it it worries about industry concentration in Canada. If  Canada's cardboard box manufacturing sector is an oligopoly made up of two firms, and one firm in the cardboard box industry significantly increases advertising expenditures to obtain a larger market share, it is most likely that other firms in the cardboard box industry will:

Chapter 14: Oligopoly    1 23.Explain how the outcome of the Cournot model is achieved. 24.An essential assumption of the Cournot model is that each firm aims to maximize profits, based on the expectation that its own output decision will not have an effect on the decisions of its rivals. Critically evaluate this assumption. 25.In choosing the optimal output, the monopolist had only to consider its own costs and the demand curve that it faced. How do things change under duopoly and what does the Cournot model argue about how firms will behave? 26.What is the output level predicted by the Cournot model? Discuss this in terms of the different market models that have been surveyed so far. 27.Evaluate the following statement. The Cournot model basically assumes that the sole decision of each firm in a duopoly is one of determining how much to produce not which price to set. 28.What is price leadership?

4) Which of the following companies is least likely to operate in an oligopoly? Burger King, which sells fast food Frontier, which provides Internet services AHF pharmacy Verizon, which provides cell phone coverage

8. Two firms, the only firms in the market, sell the same product and have the same marginal cost. They realise they would be better off if they didn't compete with each other. They enter an alternating offers bargaining game to decide how they will divide the monopoly profit, n. They have three periods to come to an agreement. If no agreement is reached after three periods, the firms will compete simultaneously in prices. The firms toss a coin to decide who makes the first offer in the bargaining game. Firm 1 wins and decides to go first. Each firm has a discount factor o. a) Draw the game tree. b) What is the subgame perfect equilibrium when 8 = 0.5? c) What is the equilibrium payoff for each firm? d) Was Firm 1 wise to opt to make the first offer? Explain your answer. %3D

When does cut-throat competition happen with oligopolistic firms? Group of answer choices When each firm acts more like a monopoly and colludes with each other to set prices in the market. When the firms compete hard and to stop acting like perfect competitors by driving up costs which leads in the long-run to higher profits. When the firms push each other with stiff competition acting like perfect competitors driving down costs, which in the long-run leads to zero profits.

1. Perloff Chapter 14, Exercise 3.13 3.13 A duopoly faces an inverse market demand function of p = 120 - Q. Firm 1 has a constant marginal cost of 20. Firm 2's constant marginal cost is 40. Calculate the output of each firm, market output, and price in (a) a collusive equilibrium or (b) a Nash-Cournot equilibrium. (Hint: See Solved Problem 14.10.) M

8. Two firms, the only firms in the market, sell the same product and have the same marginal cost. They realise they would be better off if they didn't compete with each other. They enter an alternating offers bargaining game to decide how they will divide the monopoly profit, n. They have three periods to come to an agreement. If no agreement is reached after three periods, the firms will compete simultaneously in prices. The firms toss a coin to decide who makes the first offer in the bargaining game. Firm 1 wins and decides to go first. Each firm has a discount factor o. a) Draw the game tree. b) What is the subgame perfect equilibrium when o = 0.5? c) What is the equilibrium payoff for each firm? d) Was Firm 1 wise to opt to make the first offer? Explain your answer.

Deviating from the collusive outcome  Please check the image there is a graph  Mays and McCovey are beer-brewing companies that operate in a duopoly (two-firm oligopoly). The daily marginal cost (MC) of producing a can of beer is constant and equals $0.60 per can. Assume that neither firm had any startup costs, so marginal cost equals average total cost (ATC) for each firm. Suppose that Mays and McCovey form a cartel, and the firms divide the output evenly. (Note: This is only for convenience; nothing in this model requires that the two companies must equally share the output.) Place the black point (plus symbol) on the following graph to indicate the profit-maximizing price and combined quantity of output if Mays and McCovey choose to work together.     When they act as a profit-maximizing cartel, each company will produce      cans $                and charge $        per can. Given this information, each firm earns a daily profit of   $              , so the daily total industry…

Q61 Tha use of cannabis was legalized in Canada in 2017. Assume that the  Canadian cannabis sector  is an oligopoly producing differentiated products, for example marijuana cigarettes with different levels of  THC, the active ingredient. If the four-firm concentration ratio in an oligopolistic ten-firm industry is 40 percent, and each firm has an equal percentage of sales, the Herfindahl index is Multiple Choice   400.   2,000.   800.   4,000.   1,000.

Q27 The Competition Bureau in Canada wants to increase competition and reduce monopoly power. Thus it it worries about industry concentration in Canada. Assume there is an oligopoly in Canada in the production of Computer Aided Design (CAD) machines which also has a cartel. Which of the following will make it easier for the Canadian cartel to operate effectively over time? Multiple Choice   Demand for the CAD cartel's output becomes more elastic.   The number of substitutes for the CAD cartel's output increases.   get organized crime in involved  in the production of CAD.    Each member firm of the CAD cartel observes the pricing and output decisions of other firms in the CAD cartel.   Demand for the CAD cartel's output decreases.