Question
Consider two duopolists with differentiated products, who compete in prices. Their demand and cost functions are given by Q i = a bP i +
Consider two duopolists with differentiated products, who compete in prices. Their demand and cost functions are given by Qi = a bPi + dPj, C = cqi, where Qi and Pi are their quantities and prices and where a,b,d,c are positive parameters.
a.Show that their best reply functions are upward sloping?
b.Find the Nash equilibrium prices?
c.Find their contract curve?
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Crashed How A Decade Of Financial Crises Changed The World
Authors: Adam Tooze
1st Edition
0143110357, 9780143110354
