Question
In your memo, you should explain how your country approached the cartel bargaining problem and the strategy behind its production decisions. Ideally, this would flow
In your memo, you should explain how your country approached the cartel bargaining problem and the strategy behind its production decisions. Ideally, this would flow as a narrative starting with your first decisions at the beginning of year one, the changes made throughout that year, followed by the same for year two. As you write this narrative, you should try and touch upon the following if you are able, although you should not be constrained to discuss these topics: 1. Did your country calculate the perfect collusion (dominant firm) outcome? If so, how? 2. Did your country calculate a non-cooperative outcome? If so, how? 3. How did your country formulate their bargaining position in the cartel negotiations? 4. Did your country ever adhere to the cartel agreement? If so, explain why. 5. Did your country ever cheat on the cartel agreement? If so, explain why. 6. Which of your country's actions were successful? 7. Which of your country's actions were misguided? What would you do differently? 8. Did your country's strategy change with the revelation in Year 2? If so, explain why. 9. How did the cartel's strategy change in Year 2? Did the cartel successfully achieve it? What undermined the cartel's ability to achieve it? 10. Given your cartel's ability to successfully collude in Year 1, was it easier or harder to achieve the desired strategy in Year 2? Explain why.
For the purpose of this question, can you please elaborate on what these questions are asking along with the terms used (like perfect collusion)? Maybe provide some examples of how I might go about answering these questions so I can better understand what these questions are asking.
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