3. Consider the market for video game consoles. Suppose that you formulate a multinomial logit model using the no tation found in the lecture notes. (a) (b) (C) (d) (e) (f) What would the j subscript cor respond to in this example? Give some examples. Why is there a need for an outside good in this specic example? Explain why it is diicult to delin eate a precise market in this spe cic case. See if you can nd an own price elasticity of demand for video game consoles in the literature (i.e. nd a number for this). Please cite your source. If you can't, take it to be -3 in the questions below. From here on assume that the inside goods are the Sony P55, the Nintendo Switch, and the Mi crosoft Xbox. Find the total number of video game consoles sold in the US in a specic year. Assume from here on that the mar ket size N equals the total number of US households. Determine N (g) (h) (i) (i) (k) and explain why this assumption isn't reasonable. Assume Bertrand competition in this market, i.e. assume that rms simultaneously and independently set prices to maximize prots from video game consoles. Explain why this is an unreasonable assump tion. What is the value of the Lerner index in view of your answer to 3d? Find a ballpark estimate of the number of video game consoles sold for each of the inside goods. Please cite your source. Do your best, but it does not leave to be perfect. Based on N and your answer to 3i, compute market shares. Based on your answers to 3h and 3j, compute predicted price in crease percentages for the P85 and Xbox should Sony acquire Mi crosoft's Xbox division using the upward pricing pressure formula and assuming that marginal costs do not change. Don't take these numbers seriously