Consider a duopoly for a homogeneous product. Firms i = 1, 2 set price-quantity pairs (p i
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Consider a duopoly for a homogeneous product. Firms i = 1, 2 set price-quantity pairs (pi, qi) simultaneously. If at these pairs some consumers are rationed, rationing is assumed to be efficient. Suppose firms are constrained by capacities ki > 0 and inverse market demand is P (q) = q-1. Does a Nash equilibrium in pure strategies exist? Is it unique? Characterize all Nash equilibria of this game.
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Related Book For
Industrial Organization Markets and Strategies
ISBN: 978-1107069978
2nd edition
Authors: Paul Belleflamme, Martin Peitz
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