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Description
Flashcards by Sophia Lynch, updated more than 1 year ago
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Created by Sophia Lynch
over 5 years ago
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| Question | Answer |
| P = MC = ...? MR = MC = ...? | P = MC = Economic Efficiency MR = MC = NO economic efficiency |
| For a monopoly, when AR > AC this means... | The firm is making super-normal profit. |
| For an oligopoly firm, their profits also depend on... | Other firms. |
| Why might an oligopoly act in self-interest as opposed to cooperating with other firms? | Because their motive is profit and they cannot be certain that the other firms will make decisions that will increase or decrease their profits. |
| For an oligopoly when: 1. Output effect > Price effect ... 2. Output effect < Price effect ... | 1. Raise production 2. Lower production |
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