Consider an oligopoly market with 3 firms. They face a demand curve given by p(Q) = 300-5Q, where Pmin refers to the lowest price offered by any firm. The marginal costs are the following: C₁ = 80, C₂ = 200, C3 = 210. The fixed costs for each firm are zero and firms compete a la Bertrand. Which of the following is consistent with a Nash equilibrium of this game? e refers to the minimal price change possible. (a) Pmin (b) Pmin (c) Pmin = = = 190 and only firm 1 sells. 200 - € and only firm 1 sells. E 200 and firms 1 and 2 sell.

Consider an oligopoly market with 3 firms. They face a demand curve given by p(Q) = 300-5Q, where Pmin refers to the lowest price offered by any firm. The marginal costs are the following: C₁ = 80, C₂ = 200, C3 = 210. The fixed costs for each firm are zero and firms compete a la Bertrand. Which of the following is consistent with a Nash equilibrium of this game? e refers to the minimal price change possible. (a) Pmin (b) Pmin (c) Pmin = = = 190 and only firm 1 sells. 200 - € and only firm 1 sells. E 200 and firms 1 and 2 sell.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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