Econ 213 Chapter 13

Front 1

exists when a small number of firms sell a differentiated product in a market with high barriers to entry.

Back 1

oligopoly

Front 2

an agreement among rival firms that specifies the price each firm charges and the quantity it produces.

Back 2

collusion

Front 3

a group of two or more firms that act in unison

Back 3

cartel

Front 4

attempt to prevent oligopolies from behaving like monopolies.

Back 4

antitrust laws

Front 5

a market situation where the actions of one firm have an impact on the price and output of its competitors.

Back 5

mutual interdependence

Front 6

occurs when an economic decision-maker has nothing to gain by changing strategy unless it can collude.

Back 6

Nash equlibrium

Front 7

occurs when the price of a good or service is affected by the entrance of a rival firm in the market.

Back 7

price effect

Front 8

occurs when the entrance of a rival firm in the market affects the amount produced.

Back 8

output effect

Front 9

branch of mathematics that economists use to analyze the strategic behavior of decision-makers.

Back 9

game theory

Front 10

occurs when decision-makers face incentives that make it difficult to achieve mutually beneficial outcomes.

Back 10

prisoner's dilemma

Front 11

exists when a player will always prefer one strategy, regardless of what his opponent chooses.

Back 11

dominent strategy

Front 12

a long-run strategy that promotes cooperation among participants by mimicking the opponents most recent decision with repayment in kind.

Back 12

tit-for-tat

Front 13

the first federal law limiting cartels and monopolies.

Back 13

sherman antitrust act

Front 14

targets corporate behaviors that reduce competition.

Back 14

clayton act

Front 15

occurs when firms deliberately sat their prices below average variable costs with the intent of driving rivals from the market.

Back 15

predatory pricing

Front 16

occurs when the number of customers who purchase or use a good influences the quantity demanded.

Back 16

network externality

Front 17

arises when a buyer's preference for a product increases as the number of people buying it increases.

Back 17

bandwagon effect

Front 18

costs incurred when a consumer changes from one supplier to another.

Back 18

switching costs