In a Cournot duopoly there are two firms, 1 and 2. The market price is given by p=2-9₁-92. The cost to firm i of producing any quantity is zero. Each firm's payoff is defined as its profit. Describe the normal form of this game by expressing the strategy spaces and writing the payoffs as functions of the strategies.

In a Cournot duopoly there are two firms, 1 and 2. The market price is given by p=2-9₁-92. The cost to firm i of producing any quantity is zero. Each firm's payoff is defined as its profit. Describe the normal form of this game by expressing the strategy spaces and writing the payoffs as functions of the strategies.

Microeconomics: Principles & Policy

14th Edition

ISBN:9781337794992

Author:William J. Baumol, Alan S. Blinder, John L. Solow

Publisher:William J. Baumol, Alan S. Blinder, John L. Solow

Chapter13: Between Competition And Monopoly

Section: Chapter Questions

Problem 3TY

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