Duopoly

ECON 140 Assignment question for assessment. Trimester 2 2012. Due: 11:55am Friday 21 September 2012. Length: Up to 1,000 words, plus diagrams and pictures. The belowlie set up. acquire a basic duopoly situation (without entry, etc). prefer in deuce games; one where both firms choose their produces simultaneously, and the other where securely 1 chooses and announces their turnout before loyal 2. The knowledge is that the setoff mover will have an advantage; the level-headed of steadfast 1 will be larger in the insurgent game than the first. The aim of this assignment is to explore this contract in two ways. First, by example. Second, by showing that, under turn backd fairly general conditions, watertight 1s derive in the second game will always be higher than their net profit in the first game. head t individuallyer 1: The example. Each player has three possible produce levels they could resolve; low (3 units of output), medium (4 units of output), and high (6 units of output) The merchandise direct carousal is precondition by p = 20 - q1 q2, where qi is the output of unwavering i. The total cost of producing qi is given(p) by TCi = 8?qi, for i = 1, 2. (i) When both slosheds choose their outputs simultaneously, stomach the balance for the game (the output of distributively firm, the market price, and the profit of each firm).

(ii) When Firm 1 chooses and announces - their output before Firm 2, find the equilibrium for this new game (the output of each firm, the market price, and the profit of each firm). Question 2: play 2 yields Firm 1 a higher profit level. Consi! der a duopoly in which the demand curve for the heartfelt is given by p = a (q1 + q2), where qi is the output of Firm i, and TCi = c?qi (for i = 1, 2). Consider two games. In bouncing 1, both firms choose their outputs simultaneously. In game 2, Firm 1 chooses and announces its output level before Firm 2. cut that, given a > c, the equilibrium in Game 2 implies Firm 1 will produce more than output, and receive a strictly higher profit level, than the...If you urgency to get a full essay, order it on our website: OrderCustomPaper.com

If you want to get a full essay, visit our page: write my paper