1. Jeopardy Example A merger between firms in the same industry
What is a horizontal merger?

2. Costs & Kin -- $100 A nonmonetary opportunity cost
What are implicit costs?

3. Costs & Kin -- $200 Total revenues minus explicit costs
What is accounting profit?

4. Costs & Kin -- $300
Situation in which a firm's long-run average costs rise as firm increases output
What are Diseconomies of Scale?

5. Costs & Kin -- $400
This explains why short-run marginal cost curves slope upward
What is Law of Diminishing Returns?

6. Costs & Kin -- $500
Level of output at which all economies of scale are exhausted
What is the minimum efficient scale?

7. The Price Is Right -- $100
Law of one price holds only if transaction costs are _____
What is zero?

8. The Price Is Right -- $200
Example of this pricing strategy: $9.99 instead of $10
What is odd pricing?

9. The Price Is Right -- $300
Ability of a firm to charge a price greater than marginal cost
What is market power?

10. The Price Is Right -- $400
Price discrimination will not work if ________ is possible
What is arbitrage?

11. The Price Is Right -- $500
Customers buying hardback version of a book have __________ willingness to pay than those who wait for the cheaper softback
What is greater?

12. Competitive Markets -- $100
In long run in competitive markets, economic profits equal ______
What is zero?

13. Competitive Markets -- $200
Benefit of being first firm to enter a market
What is first-mover advantage?

14. Competitive Markets -- $300
Under perfect competition, number of units a firm sells when it raises price of product
What is zero?

15. Competitive Markets -- $400
Minimum point on firm's Avg Variable Cost (AVC) curve
What is the shutdown point?

16. Competitive Markets -- $500
State of economy where production represents consumer preferences
What is allocative efficiency?

17. The –opolies -- $100 Type of product produced by monopoly
What is unique (aka one without close substitute)?

18. The –opolies -- $200
One of four main reasons monopolies arise (i.e., barriers to entry)
What is
Govt action blocks entry
Control of a key resource
Network externalities
Natural monopoly (extremely large economies of scale)?

19. The –opolies -- $300 Tool used to assess sequential games
What is Decision Tree?

20. The –opolies -- $400
Game in which pursuing dominant strategies results in noncooperation that leaves everyone worse off
What is Prisoner’s Dilemma?

21. The –opolies -- $500
Apple’s dominant strategy
What is charging $9.99?

22. Which Market Model -- $100
Industry examples: growing wheat, poultry farming
What is perfect competition?

23. Which Market Model -- $200 Many firms, differentiated products
What is monopolistic competition?

24. Which Market Model -- $300
NFL or NBA are examples
What is a monopoly?

25. Which Market Model -- $400 Allocatively & productively efficient
What is perfect competition?

26. Which Market Model -- $500
Typical firm's long- run average cost curve reaches minimum at output that is large fraction of industry sales
What is an oligopoly?

27. Health Care Econ -- $100 UK's health care system
What is socialized medicine?

28. Health Care Econ -- $200
Doctors and hospitals receive a payment for each service they provide
What is fee-for- service?

29. Health Care Econ -- $300
Adverse selection and moral hazard are two main forms of this
What is asymmetric information?

30. Health Care Econ -- $400
Measure taken by the government to reduce adverse selection problems
What is mandate to buy health insurance (or face a fine)?

31. Health Care Econ -- $500
When insurers delegate decision- making power to doctors who may not have same interests as insurers
What is principal- agent problem?

32. FINAL JEOPARDY