Consider a cournot model where the market demand is p a -


Consider a Cournot model where the market demand is P = a - qA - qB. Both firms have constant average and marginal cost of c. Demand, however, is uncertain: it is high (a = aH) with probability f and low (a = aL) with probability 1 - f. Firm A has done a market study and knows whether demand is high or low, but Firm B does not. The two firms choose quantities simultaneously. Find the Bayes Nash equilibrium in this game.

Request for Solution File

Ask an Expert for Answer!!
Econometrics: Consider a cournot model where the market demand is p a -
Reference No:- TGS0568256

Expected delivery within 24 Hours