- CFA Exams
- CFA Level I Exam
- Topic 2. Economics
- Learning Module 1. The Firm and Market Structures
- Subject 8. Oligopoly
CFA Practice Question
An equilibrium in which the players make and share the monopoly profit is a ______
B. contestable market
C. Nash equilibrium
D. cooperative equilibrium
A. collusive agreement
B. contestable market
C. Nash equilibrium
D. cooperative equilibrium
Correct Answer: C
User Contributed Comments 6
| User | Comment |
|---|---|
| pavelopv | why C? isn't monopolistic profit divided amoung players in collusive agreement? At Nash equilibrium sum of profits of the players is less than monopolistic profit! Am I mistaken? |
| Mikael | If players SHARE the monopoly profit, they cooperate, which is not always the case in a Nash equilibrium. So, D is my answer. |
| Sabs | Read the question guys, it say "An equilibrium....." Its asking about the equilibrium not what kind of agreement. |
| JoeHoong | Wow, "an equilibrium", tricky question.. |
| dipu617 | Thanks Sabs!! |
| fzhou | It's "share the monopoly profit" that makes the questions tricky... |