11. In a Bertrand duopoly with homogenous goods and symmetric and identical constant marginal costfunctions the Nash equilibrium has:.a. A price that is equal to marginal cost.b. Profits that are positive.c. The characteristic of strictly upward sloping best response functions.d. None of the above is a correct answer.12. In a Bertrand duopoly with homogenous goods and uncertain marginal costs the symmetric BayesianNash equilibrium has:.a. All type of firms setting a price equal to marginal cost.b. Expected profits that are strictly positive.c. That the more firms in the industry lead to lower output levels in the industry.d. None of the above is a correct answer.13. Suppose the markup or Lerner index at a symmetric Cournot-Nash equilibrium with n firms is L (n) =e where a is a demand parameter, c is the identical and symmetric marginal cost for all firms, a > c.This implies that:a. As n increases towards infinity the industry behaves as in perfect competition, ceteris paribus.b. As n increases towards infinity the equilibrium price goes towards marginal cost, ceteris paribus.c. Market power of a firm in this industry vanishes as n increases towards infinity, ceteris paribus.d. All of the above are correct answers.a+nc

The term "Bertrand competition" was coined by Joseph Louis François Bertrand (1822–1900) to describe…

11. In a Bertrand duopoly with homogenous goods and symmetric and identical constant marginal cost functions the Nash equilibrium has:. a. A price that is equal to marginal cost. b. Profits that are positive. c. The characteristic of strictly upward sloping best response functions. d. None of the above is a correct answer.

11. In a Bertrand duopoly with homogenous goods and symmetric and identical constant marginal cost functions the Nash equilibrium has:. a. A price that is equal to marginal cost. b. Profits that are positive. c. The characteristic of strictly upward sloping best response functions. d. None of the above is a correct answer.

Principles of Microeconomics (MindTap Course List)

8th Edition

ISBN:9781305971493

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter17: Oligopoly

Section: Chapter Questions

Problem 5PA

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