CHAPTER 9

5. maximizes profit given the output produced by the leader
7. Defines the profit-maximizing level of output for a firm given output levels of the other firms.
8. refers to a situation where there are relatively few large firms in an industry.
11. Firms differ with respect to when they make decisions, a single firm chooses an output before their rivals select their output

1. Whenever a market is dominated by only a few firms, firms can benefit at the expense of consumer by agreeing to restrict output or equivalently, to charge higher prices.
2. If each firms expects its own output decision to have no impact on rivals' output decisions then this scenario describe __.
3. Has been criticized because it offers no explanation of how the industry settles on initial price P0 that generates the kink in each firm's demand curve.
4. A market in which all firms have access to same technology, consumers respond quickly to changes, and there are no sunk cost
6. A function that defines combination of outputs produced by firms that yield a given firm the same level of profits.
9. Has a first mover advantage
10. The treatment here assumes the firms sell identical products and that consumers are willing to pay the monopoly price for the good.