Industrial Organization: Oligopoly and Strategy

<p>Market potential for innovation (D)</p> Signup and view all the answers

<p>Product differentiation and advertising (D)</p> Signup and view all the answers

<p>Chapter 16 (B)</p> Signup and view all the answers

<p>Chapter 9 (C)</p> Signup and view all the answers

<p>Fierce price competition (D)</p> Signup and view all the answers

<p>A few firms have significant market power (B)</p> Signup and view all the answers

<p>Existing firms can maintain higher prices (D)</p> Signup and view all the answers

<p>Bertrand model (C)</p> Signup and view all the answers

<p>They increase market power for existing firms. (A), They reduce the number of competitors in a market. (C)</p> Signup and view all the answers

<p>Aggressive price-cutting by one or more firms (D)</p> Signup and view all the answers

<p>Collusion among firms to set prices. (B)</p> Signup and view all the answers

<p>Pooling resources to create a cartel (D)</p> Signup and view all the answers

<p>They can act as a barrier to entry for new firms. (A)</p> Signup and view all the answers

<p>They create cost advantages for established firms (D)</p> Signup and view all the answers

<p>Low product differentiation among firms (C)</p> Signup and view all the answers

<p>Potential long-term harm to some firms' profitability. (A)</p> Signup and view all the answers

<p>Reduction in prices leading to lower revenues (A)</p> Signup and view all the answers

<p>Ability to influence market prices significantly. (B)</p> Signup and view all the answers

<p>How do firms maintain market power? (A)</p> Signup and view all the answers

<p>Rivalry among existing competitors. (D)</p> Signup and view all the answers

<p>Firm output increases with the number of competitors. (D)</p> Signup and view all the answers

A situation where each player in a game chooses the best strategy given the strategies chosen by the other players.

Games where players move in a specific order or sequence.

Games that are played more than once.

A model of competition among firms, firms competing on price.

A model of competition where firms compete on the quantity of output they produce.

Secret cooperation between competitors.

A period of intense competition among firms in which firms cut prices to gain market share.

Costs that a firm must bear to enter a market.

Industrial organization studies how markets and industries function, focusing on how firms compete with each other.

A firm's ability to influence the price of its product or service, giving it control over the market.

Markets where entry and exit are easy, making it difficult for incumbent firms to maintain high prices, even with market power.

When resources are not allocated efficiently, leading to a mismatch between supply and demand.

When production methods are not used efficiently, leading to higher costs and less output.

Effort by firms to gain or maintain market power, often through lobbying, influencing regulations, or engaging in anti-competitive practices.

Government interventions in markets to influence the structure, conduct, and performance of industries.

A framework that links industry structure (number of firms, market share), conduct (strategies of firms like pricing, advertising), to performance (efficiency, profitability).

The study of imperfect competition, where firms have some control over prices and outputs. Focuses on how firms compete and interact in the market.

A market structure with a few dominant firms, each with a significant market share. Each firm's actions influence the other firms.

A tool for analyzing strategic interaction, predicting how players will choose actions given their understanding of each other's incentives.

A model where firms make decisions simultaneously, without knowing the other players' actions. Outcomes are determined by the equilibrium.

A model where firms can observe and react to the actions of their competitors over time. Decisions are based on the knowledge of past and present actions.

Factors like technology, demand, mergers, and firm strategies that determine how the structure of an industry evolves.

Framework used to analyze industries, looking at structure (market features), conduct (firm behavior), and performance (outcomes, efficiency)

Features like number of firms, product differentiation, barriers to entry, and the nature of competition.