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3. Iqsi#2ere a first or second mover advantage? Why or why not? 4. Suppose that the game in question #2 was played...
Player 2 Left Right Player 1 Up 10,10 2,5 Down 5,2 2,2 6. If the game in #5 is sequential what is the equilibrium?...
Player 2 Left Right Player 1 Up 10,10 2,5 Down 5,2 2,2 6. If the game in #5 is sequential what is the equilibrium? 7. What does Common Knowledge of the game mean and why is it important? 8. Consider the following market with two firms. Suppose that firms produce identical goods and are faced with the inverse market demand curve P = 100 - 20. Further, suppose that firms have identical cost functions of C = 10 + 20q....
1. Suppose that firm 1 in the market described in question 1 has first mover advantage....
1. Suppose that firm 1 in the market described in question 1 has first mover advantage. (Market demand is Q = 18 – P and both firms have the same cost C(q) = Q2) a. What do we call a market where two firms move sequentially? b. Set up and solve for firm 1's output, firm 2's output, market output, and equilibrium price. Show all work for each step. C. Do consumers prefer this over the Cournot equilibrium ? d....
1 1. Suppose that firm 1 in the market described in question 1 has first mover...
1 1. Suppose that firm 1 in the market described in question 1 has first mover advantage. (Market demand is e = 18 – P and both firms have the same cost C(Q) a. What do we call a market where two firms move sequentially? 302) b. Set up and solve for firm l's output, firm 2's output, market output, and equilibrium price. Show all work for each step. C. Do consumers prefer this over the Cournot equilibrium you described...
Suppose that the inverse market demand for a commodity is given by P = 240 Q...
Suppose that the inverse market demand for a commodity is given by P = 240 Q The cost curves of the three firms which could serve this market are TC,(a) 30q +300 and TC2() (d) Suppose that firms engage in Stackelberg rather than Cournot competition. Firm 1 moves first by choosin its output level. After Firm 1 has chosen its output level, Firm 2 observes ql and chooses its output leve Find the subgame-perfect Nash equilibrium of the Stackelberg game....
4. Consider the following game that is played T times. First, players move simultaneously and independently....
4. Consider the following game that is played T times. First, players move simultaneously and independently. Then each player is informed about the actions taken by the other player in the first play and, given this, they play it again, and so on. The payoff for the whole game is the sum of the payoffs a player obtains in the T plays of the game A 3,1 4,0 0,1 В 1,5 2,2 0,1 C 1,1 0,2 1,2 (a) (10%) Suppose...
NormalForm_Cournot References Mailings Review View A A Aa EE AaBbCcDdEe AaBbCcDdEe AaBbCcD AaBbCcDdE A Normal No Sp...
NormalForm_Cournot References Mailings Review View A A Aa EE AaBbCcDdEe AaBbCcDdEe AaBbCcD AaBbCcDdE A Normal No Spacing Heading 1 Heading 2 4 6 Game Theory HW #3 1. Intuitively, why is the normal form of a game (a table) not the best way to represent a sequential game? 2. Suppose that you and a friend play the following game and you move first. Diagram the game in its extensive form and identify the equilibrium. Your Friend Left 10,10 Down 14,...
Differentiated Bertrand competition versus price leadership. The demand for two brands of laundry detergent, Wave (W)...
Differentiated Bertrand competition versus price leadership. The demand for two brands of laundry detergent, Wave (W) and Rah (R), are given by the following demands: Qw =80–2pW +pR QR =80–2pR +pWThe firms have identical cost functions, with a constant marginal cost of 10. The firms compete in prices. (a) What is the best response function for each firm? (that is, what is firm W's optimal price as a function of firm R’s price, and vice-versa?) What is the equilibrium to...
Please explain why T/F answer? 1 pts Question 7 The advantage to being the late mover...
Please explain why T/F answer?
1 pts Question 7 The advantage to being the late mover or follower strategy is that you learn from the mistakes that the first mover makes C True False 1 pts Question 8 Firms have to choose between two different strategies of entry one is a non-equity strategy and the other is an equity strategy C True False 1 pts Question 9 Joint ventures are considered a desirable strategy for firms that want tight control...
Problems 3,4 and 5 Problem 3. Consider the game below. (a) There are no dominant or...
Problems 3,4 and 5
Problem 3. Consider the game below. (a) There are no dominant or dominated strategies. Is there anything you can say about what players will do? Player 2 C T (2,1) (0,2) M (1,1) (1,1)| (1,0) B(0,1) (2,0) (2,2) (0,3) Player (b) Report the best responses Problem 4. Bertrand Competition With Different Costs Suppose two firms facing a demand Dip) compete by setting prices simultaneously (Bertrand Competition). Firm 1 has a constant marginal cost e and Firm...
Two profit-maximizing firms compete in a market. Firm 1 chooses quantity qı > 0 and Firm...
Two profit-maximizing firms compete in a market. Firm 1 chooses quantity qı > 0 and Firm 2 chooses quantity 42 > 0. The market price is: p(91,92) = 8 - 2q1 - 42. The cost to Firm 1 of producing qi is C1 = 41. The cost to Firm 2 of producing 92 is C2 = 42 + 42. a.) * Calculate the best-response function for each firm. b.) Suppose the two firms choose their quantities simultaneously. What is the...
Player 2 Left Right Player 1 Up 10,10 2,5 Down 5,2 2,2 6. If the game in #5 is sequential what is the equilibrium? 7. What does Common Knowledge of the game mean and why is it important? 8. Consider the following market with two firms. Suppose that firms produce identical goods and are faced with the inverse market demand curve P = 100 - 20. Further, suppose that firms have identical cost functions of C = 10 + 20q....
1. Suppose that firm 1 in the market described in question 1 has first mover advantage. (Market demand is Q = 18 – P and both firms have the same cost C(q) = Q2) a. What do we call a market where two firms move sequentially? b. Set up and solve for firm 1's output, firm 2's output, market output, and equilibrium price. Show all work for each step. C. Do consumers prefer this over the Cournot equilibrium ? d....
1 1. Suppose that firm 1 in the market described in question 1 has first mover advantage. (Market demand is e = 18 – P and both firms have the same cost C(Q) a. What do we call a market where two firms move sequentially? 302) b. Set up and solve for firm l's output, firm 2's output, market output, and equilibrium price. Show all work for each step. C. Do consumers prefer this over the Cournot equilibrium you described...
Suppose that the inverse market demand for a commodity is given by P = 240 Q The cost curves of the three firms which could serve this market are TC,(a) 30q +300 and TC2() (d) Suppose that firms engage in Stackelberg rather than Cournot competition. Firm 1 moves first by choosin its output level. After Firm 1 has chosen its output level, Firm 2 observes ql and chooses its output leve Find the subgame-perfect Nash equilibrium of the Stackelberg game....
4. Consider the following game that is played T times. First, players move simultaneously and independently. Then each player is informed about the actions taken by the other player in the first play and, given this, they play it again, and so on. The payoff for the whole game is the sum of the payoffs a player obtains in the T plays of the game A 3,1 4,0 0,1 В 1,5 2,2 0,1 C 1,1 0,2 1,2 (a) (10%) Suppose...
NormalForm_Cournot References Mailings Review View A A Aa EE AaBbCcDdEe AaBbCcDdEe AaBbCcD AaBbCcDdE A Normal No Spacing Heading 1 Heading 2 4 6 Game Theory HW #3 1. Intuitively, why is the normal form of a game (a table) not the best way to represent a sequential game? 2. Suppose that you and a friend play the following game and you move first. Diagram the game in its extensive form and identify the equilibrium. Your Friend Left 10,10 Down 14,...
Please explain why T/F answer?
1 pts Question 7 The advantage to being the late mover or follower strategy is that you learn from the mistakes that the first mover makes C True False 1 pts Question 8 Firms have to choose between two different strategies of entry one is a non-equity strategy and the other is an equity strategy C True False 1 pts Question 9 Joint ventures are considered a desirable strategy for firms that want tight control...
Problems 3,4 and 5
Problem 3. Consider the game below. (a) There are no dominant or dominated strategies. Is there anything you can say about what players will do? Player 2 C T (2,1) (0,2) M (1,1) (1,1)| (1,0) B(0,1) (2,0) (2,2) (0,3) Player (b) Report the best responses Problem 4. Bertrand Competition With Different Costs Suppose two firms facing a demand Dip) compete by setting prices simultaneously (Bertrand Competition). Firm 1 has a constant marginal cost e and Firm...
Two profit-maximizing firms compete in a market. Firm 1 chooses quantity qı > 0 and Firm 2 chooses quantity 42 > 0. The market price is: p(91,92) = 8 - 2q1 - 42. The cost to Firm 1 of producing qi is C1 = 41. The cost to Firm 2 of producing 92 is C2 = 42 + 42. a.) * Calculate the best-response function for each firm. b.) Suppose the two firms choose their quantities simultaneously. What is the...
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