Econ quiz Flashcards
1
Q
5 rules of a perfect competition market
A
- Many buyers and sellers
- No barriers to entry or exit
- Price takers
- Homogenous goods/ same goods
- Long run profit is zero
2
Q
5 rules of a monopoly
A
- Many barriers to entry
- High barriers to entry
- Price Maker
- Differentiated Good
- Long run profits are greater than zero
3
Q
Shutdown
Startup
SR or LR
A
P<AVC>AVC
SR</AVC>
4
Q
Enter
Exit
A
P>ATC
P<ATC
LR
5
Q
5 rules of a monopolistic competition
A
- Many buyers, few sellers
- Some barriers to entry
- Price Maker
- Similar but differentiable
- SR profits > 0, LR profits = 0
6
Q
Profit maximization
A
MC=MR
7
Q
Profits =
A
(P-ATC)q
8
Q
5 rules of a Oligopoly
A
- Many buyers few sellers
- Moderately high barriers to entry
- Price Maker
- Similar
- LR profits are greater than 0
9
Q
Bertrand Game
A
Players competing over prices
10
Q
Cornout Game
A
Players complete on Quantity
11
Q
Stackelberg Game
A
Players sequentially compete on Q
12
Q
5 rules of a monopsony
A
- 1 buyer many sellers
- Low barriers to entry
- Price maker
- Homogenous or similar
- LR profit is greater than 0
