Bid-rigging is more likely when
a. auctions are larger
b. auctions are frequent
c. auctions generate different sets of potential bidders
d. the auctioneer is paid on commission rather than a fixed fee
QUESTION 2An efficient allocation of productive inputs requires that:
a. each output has the same rate of technical substitution among inputs used.
b. each output has the same marginal rate of substitution for consumers.
c. each pair of outputs has the same rate of product transformation.
d. each individual has the same marginal rate of substitution between outputs.
QUESTION 3The lower the barriers to entry and exit, the more nearly a market structure fits the ____ market model.
a. monopolistic competition
b. perfectly contestable
c. oligopoly
d. monopoly
e. none of the above
QUESTION 4Bid-rigging is more likely when
a. auctions are larger
b. auctions are infrequent
c. auctions generate the same set of potential bidders
d. the auctioneer is paid on commission rather than a fixed fee
QUESTION 5Suppose two goods (x and y) are being produced efficiently and that the production of x is always more labor intensive than the production of y. Production depends only on two factors (capital and labor); these may be smoothly substituted for each other. The total quantities of these inputs are fixed. An increase in the production of x and a decrease in the production of y will:
a. increase the capital-labor ratio in each firm.
b. decrease the capital-labor ratio in each firm.
c. leave the capital-labor ratio for each firm unchanged.
d. increase the capital-labor ratio in y production and decrease the capital-labor ratio in x production.
QUESTION 6____ yields the same results as the theory of perfect competition, but requires substantially fewer assumptions than the perfectly competitive model.
a. Baumol's sales maximization hypothesis
b. The Pareto optimality condition
c. The Cournot model
d. The theory of contestable markets
e. none of the above
QUESTION 7The following is not associated with bid-rigging
a. bid-riggers bidding their true value
b. knockout auctions
c. bid rotations
d. amnesty to the first conspirator willing to testify against fellow conspirators
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