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Part A: True, false or depends (Please explain briefly)1. Collusive agreements are harder to sustain if demand is very variable (uncertain) and also very hard to sustain the more product differentiation there is).2. The only disagreement so far among the newlyweds Miss Young and her boss is that she likes Diet Pepsi while he prefers Diet Coke. They were out of Coke soshe poured Pepsi and he did not notice the difference. “There is no product differentiation in soft-drinks”, she concluded…3. The greater the degree of product differentiation the greater the market power.4. The monopolistic competition model has the same long run predictions than the perfect competition model, that is, profits in the long run are zero, so the long-run total output is the same.5. I want to measure the effect of a law that passed two months ago in Alameda county (this is a made up change- it did not happen), that resulted in lowering a tax on wine consumption. I want to see ifA) wine purchases changed due to a lower taxB) there are more drunk -driving accidents due to this law change as people consume more alcohol.
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