Which of the Following Is True of the Cournot Model

question 31

Multiple Choice

Which of the following is true of the Cournot model of a duopoly?

• A) The products sold by the firm are imperfect substitutes.
• B) The equilibrium price in a Cournot duopoly is higher than the price in a monopoly.
• C) The demand curve facing each firm is horizontal.
• D) The market price is determined by the output produced by the firm with the larger market share.
• E) The duopoly equilibrium lies between the pure-monopoly and purely competitive outcomes.

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Definitions:

Difference Threshold

The smallest amount by which a stimulus can be changed and the difference be detected half the time, also known as the just noticeable difference.

Weber's Law

A principle stating that the smallest noticeable difference in stimulus intensity is proportional to the intensity of the initial stimulus.

Chronic Obstructive Pulmonary Disease (COPD)

A group of lung diseases characterized by increasing breathlessness, frequent coughing, and sputum production.

Perfusion

The process of delivering blood to a capillary bed in the biological tissue, essential for delivering nutrients and oxygen to cells.