Answer Happy

PART I: State whether the following statement is true or false. Support your answer with brief explanation. 1. If a game has finite number of players and strategies, there always exists at least one dominant strategy for some player. [3 marks] 2. Suppose that a profit maximizing monopolist has a constant marginal cost equal to 2 and faces the following inverse demand: P = 10 - Q. The Learner Index at profit maximizing price is 0.75. [3 marks] 3. Merger policy is concerned almost exclusively with potential consumer harm from increased market power post-merger. [3 marks] 4. A market has 6 firms. One of them has a market share of 50%, a second 20%, a third 15%, and the other three 5% each. The 4 firm concentration ratio is 70%. [3 marks] 5. An industry has three firms with market shares of 50%, 20%, and 30%, respectively. The Herfindabl-Hirschman, Index (HHI) is 2,900. [3 marks]