Y6

2. Two rms are engaging in Bertrand competition, competing for the market by their choices of prices. Firm A has a marginal cost of 120 while Firm B has a marginal cost of 240. The market demand is D(P) = 480 2P. (a) Can (pA = 95,193 : 95) be a Nash Equilibrium? (b) If FirmA was a monopolist, what price would it charge? (c) Calculate the Nash Equilibrium (approximately if needed). ((1) Calculate the Deadweight Loss of the Nash Equilibrium