If Two Duopolists Arrive at the Nash Equilibrium Output Level,the

question 130

Multiple Choice

If two duopolists arrive at the Nash equilibrium output level,the total quantity of the good on the market will be ________ the total quantity on the market if the market were perfectly competitive and ________ the total quantity on the market if the market were controlled by a monopoly.

• A) less than; less than
• B) less than; greater than
• C) greater than; greater than
• D) greater than; less than
• E) greater than; equal to

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Definitions:

Disposable Income

The amount of money a household or individual has available to spend or save after taxes have been deducted.

Government Expenditure

The total amount of money spent by the government on various services and investments.

Discretionary Fiscal Policy

Government policy that involves altering government spending and taxation to influence the economy, based on current economic conditions.

Automatic Stabilizers

Structural features of government spending and taxation that reduce fluctuations in disposable income, and thus consumption, over the business cycle.