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Question 3 Consider a Cournot dnopoly operating in a market with inverse demand p(Q) = a - Q, where Q = q1 + {42 is
Question 3 Consider a Cournot dnopoly operating in a market with inverse demand p(Q) = a - Q, where Q = q1 + {42 is the aggregate quantity on the market. Demand is high (a = 8) with probability % and low [a = 4) with probability %. Firm 1 knows whether demand is high or low, but rm 2 does not. Both firms have production eosts of zero, so prots are equal to revenues. All these are common knowledge- The two rms simultaneously choose quantities. What is the Bayesian Nash equilibrium of this game
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