We could make one more adjustment in the bertrand model of


Question: We could make one more adjustment in the Bertrand model of this section and see what effect it has on the model. What if we put a limit on the total quantity that a firm can produce? This limits the supply and possibly will put a floor on prices. Let K ≥ 2 denote the maximum quantity of gadgets that each firm can produce and recall that D( p) = - p is the quantity of gadgets demanded at price p. Find the profit functions for each firm.

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Management Theories: We could make one more adjustment in the bertrand model of
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