Match each of the terms on the left with its definition on the right. Click on the term first and then click on the matching definition. As you match them correctly they will move to the bottom of the activity.
imperfect competition oligopoly monopolistic competition Nash equilibrium prisoner’s dilemma cartel or collusion Bertrand competition Cournot competition residual demand curve residual marginal revenue curve reaction curve first- Stackelberg competition differentiated product market monopolistic competition | Oligopoly model in which each firm chooses the price of its product. Competition between a small number of firms. Market structures with characteristics between those of perfect competition and monopoly. Oligopoly behavior in which firms coordinate and collectively act as a monopoly to gain monopoly profits. A type of imperfect competition with a large number of firms in which each firm has some market power but makes zero economic profit in the long run. Market with multiple varieties of a common product. In Cournot competition, the demand remaining for a firm’s output given competitor firms’ production quantities. Oligopoly model in which each firm chooses its production quantity. A marginal revenue curve corresponding to a residual demand curve. In Stackelberg competition, the advantage gained by the initial firm in setting its production quantity. A situation in which the Nash equilibrium outcome is worse for all involved than another (unstable) outcome. A market structure characterized by many firms selling a differentiated product with no barriers to entry. Oligopoly model in which firms make production decisions sequentially. An equilibrium in which each firm is doing the best it can conditional on the actions taken by its competitors. A function that relates a firm’s best response to its competitor’s possible actions. In Cournot competition, this is the firm’s best production response to its competitor’s possible quantity choices. |