What’s the right answer for this question ? The Nash equilibrium in Bertrand competition with identical...
I only need answers for the Bertrand Nash Equilibrium section. please provide answers with as much details as possible. Thank you Oligopoly There are two firms competing in the market for Airplanes - Boeing and Airbus. The market demand is given by Q = 120 - P. Boeing has lower Marginal Costs of production than Airbus. Thus MCB = $20, MCA = $40. Assume that TFC = $0 for both firms. (Think of price being in thousands.) Boeing a) Derive...
consider the standard Bertrand model of price competition. There are two firms that produce a homogenous good with the same constant marginal cost of c. a) Suppose that the rule for splitting up cunsumers when the prices are equal assigns all consumers to firm1 when both firms charge the same price. show that (p1,p2) =(c,c) is a Nash equilibrium and that no other pair of prices is a Nash equilibrium. b) Now, we assume that the Bertrand game in part...
2.2 Bertrand Competition Which of the following statement is NOT true? In a market of duopoly firms competing in quantities, the equilibrium price is higher than the marginal cost of firms. In a market of duopoly firms competing in quantities, the equilibrium price is lower than the price charged by a monopoly firm. In a market of duopoly firms competing in prices, the more efficient firm survives and charges a price equals to its marginal cost. ) In a market...
Consider the following variation of the Bertrand competition model (e.g., price competition) discussed in class. Two firms, 1 and 2, are producing the same identical product. Firms compete in prices: Firm 1 choses pı, and Firm 2 choses p2. Given pı and p2, the individual demands of fhrms are: 10-pi pi 〈 p2 Pi P2 0 P1〈P2 Both firms have constant marginal costs of c. To sum up, the payoffs are as follows: 2 C 92 (P1, P2 Unlike the...
Suppose two firms are engaged in price competition (also known as Bertrand competition). Neither firm has capacity constraints, and both firms have identical cost structures given by c(y)= 10+ 2y? What are the equilibrium profits for each firm?
4. Bertrand Competition (29 points) Consider a Betrand Model. The market demand is P=130-Q. Consumers only buy from the firm charging a lower price. If the two firms charge the same price. they share the market equally. The marginal cost for firm 1 is 10, and the marginal cost for firm 2 is also 10. There are no fixed costs. A. (5 points) Would any firm charge a price below 10 at the market equilibrium? Briefly explain your reason. B....
4. Bertrand Competition (29 points) Consider a Betrand Model. The market demand is P-180-Q. Consumers only buy from the firm charging a lower price. If the two firms charge the same price, they share the market equally. The marginal cost for firm 1 is 30, and the marginal cost for firm 2 is also 30. There are no fixed costs. A. (5 points) Would any firm charge a price below 30 at the market equilibrium? Briefly explain your reason B....
4. Bertrand Competition (29 points) Consider a Betrand Model. The market demand is P-130-Q, Consumers only buy from the firm charging a lower price. If the two firms charge the same price, they share the market equally. The marginal cost for firm 1 is 10, and the marginal cost for firm 2 is also 10. There are no fixed costs. A. (5 points) Would any firm charge a price below your reason. at the market equilibrium? Briefly explain B. (6...
pls answer as many qwuestions!! 1. A market has an inverse demand curve and four firms, each of which has a constant marginal cost of. If the firms form a profit-maximizing cartel and agree to operate subject to the constraint that each firm will produce the same output level, how much does each firm produce? 2. Duopoly quantity-setting firms face the market demand curve. Each firm has a marginal cost of $60 per unit. a. What is the Nash-Cournot equilibrium?...
In long run equilibrium, a competitive firm maximizes profits by a. producing an output level where marginal revenue equals marginal cost. b. charging a price equal to marginal revenue and marginal cost. c. charging a price where marginal cost equals average total cost. d. All of the above are correct.