Consider a market with inverse demand PP(Q) = 50 Q, where Q denotes the quantity and P the price. The market is served by two firms, so that Q = q1 + 92. Both firms produce the good at constant marginal and average total costs of c1 = C2 = 5. O None of the answers is correct. O Firms have to pay a fixed cost to produce. O If the two firms form a collusive monopoly, the industry profit is 200. O If the two firms compete in quantities, the market price in the Nash equilibrium is 35. O If the two firms compete in quantities, the best response function of firm 1 is q1 (92 ) = 50 - 2 92.Suppose that firm 1 and firm 2 produce a homogeneous good. The inverse market demand is given by P(Q) = 100 2Q, where Q = q; + g2 denotes the aggregated output and P the price. The cost function of firm 1 is given by C} (ql) = 2q; . The cost function of firm 2 is given by C2(q2) = %qg The two firms compete in quantities. Determine the market price in the Nash equilibrium. O 38.25 O 30.875 O 61.75 O 69.125 (O None of the answers is correct. Consider the following game in normal form. e N { |o[z05 | n (O Lis strictly dominated by R if x is sufficiently large. O If xis strictly larger than 5, there exists an outcome that is better than the Nash equilibrium outcome. O For x is strictly smaller than 5, this game has exactly one Nash equilibrium in pure strategies. O If xis zero, this game has exactly one Nash equilibrium in mixed strategies, in which player 1 plays O with probability 1/3 and player 2 plays R with probability 1/3. (O None of the answers is correct. Consider the following game in normal form. Player 2 L N Player A 8,11 0,0 1 B 9,-1 0.5,5 Assume that the game will be repeated infinitely many times, and that player 2 is playing a grim trigger strategy. That is, he starts in the first period with L and plays L as long as player 1 does not deviate from A. If player 1 deviates from A, i.e., if player 1 plays B, player 2 chooses N in the next period and all future periods. How large needs to be, such that player 1 has no incentive to depart from A in the first period? 0 62 17 082 71 None of the answers is correct