Question 1: A standard economic argument is that firms with brand names have more of an incentive to maintain higher product quality than firms without recognized brand names.

Question 2: For Game Theory models represented in a payoff matrix, the payoffs may be either positive or negative.

Question 3: In the model of monopolistic competition, firms collude to keep prices and profits high.

Question 4: The Mankiw text recounts a famous phone conversation between the CEOs of two rival airlines. In the conversation, one CEO suggested to the other that they both lower prices to increase the number of customers.

Question 5: In the US and England, before passage of the Sherman Antitrust act, when firms made collusive agreements, these agreements were typically upheld in court. For example, if Firm A and Firm B both signed a document to both reduce output, and Firm A did not reduce output, Firm B could sue Firm A in court and would typically win.