The unlabeled red curves shown before illustrate the:

a. long-run average-total-cost curves of various firms constituting the industry.

b. short-run average-total-cost curves of various firms constituting the industry.

c. short-run average-total-cost curves of various plant sizes available to a particular firm.

d. short-run marginal-cost curves of various plant sizes available to a particular firm.

Is the game shown before a zero-sum game or is it a positive-sum game? How can you tell? Are there dominant strategies in this game? If so, what are they? What cell represents a Nash equilibrium and why? Explain why it is so difficult for Uptown and RareAir to achieve and maintain a more favorable cell than the Nash equilibrium in this single-period pricing game.

“No firm is completely sheltered from rivals; all firms compete for consumer dollars. If that is so, then pure monopoly does not exist.” Do you agree? Explain. How might you use Chapter 6’s concept of cross elasticity of demand to judge whether monopoly exists?

Gomez runs a small pottery firm. He hires one helper at $12,000 per year, pays annual rent of$5,000 for his shop, and spends $20,000 per year on materials. He has$40,000 of his own funds invested in equipment (pottery wheels, kilns, and so forth) that could earn him $4,000 per year if alternatively invested. He has been offered$15,000 per year to work as a potter for a competitor. He estimates his entrepreneurial talents are worth $3,000 per year. Total annual revenue from pottery sales is$72,000. Calculate the accounting profit and the economic profit for Gomez’s pottery firm

Which of the following could explain why a firm is a monopoly? Select one or more answers from the choices shown. LO12.2 a. Patents. d. Government licenses. b. Economies of scale. e. Downsloping market demand. c. Inelastic demand.