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- Q) Let x and y be real numbers and consider the game in Table 1. Using the concepts of dominance, best response and rationalizability, for which values of x and y is this game dominance solvable? Make sure to clearly explain the concepts used, and your reasoning. Hint: There are two possible cases which do not involve the same NE. i attached image. solve it early i upvote definetly13) Two identical firms are engaged in Cournot competition, with cost functionsTCA(QA) = 30 QA and TCB(QB) = 30 QB. The market demand is given by P = 480 –3Q.a) Plot the best response functions and report the Cournot-Nash equilibrium quantities, price and profits.b) What are the prices, quantities, and profits for the firms if they decide to collude and share profits equally?c) Show that firms have an incentive the deviate from the collusive outcome.d) Find the Stackelberg equilibrium if A leads and B follows.e) Show the equilibria in the previous parts on the inverse demand function. Calculate and identify consumersurplus and deadweight loss in each equilibrium. If you can only answer a limited amount of questions, please answer d and e :)A) Focus on the strategic game at the lower-right side of the gametree. Find all the Nash equilibria for this subgame, including the mixed-strategyones. (b) Find all the subgame perfect equilibria for the entire game, allowingfor both pure and mixed strategies
- Explain and discuss game theory approach of modeling competition: a) What is the difference between the equilibrium in dominant strategies and Nash equilibrium? Show one game example in tabular (simple) form and the other in decision tree (extended) form to support your answer. b) In what circumstances players choose to follow maximin strategy? Support your answer with specific examples please.suppose fiat recently entered into an agreement and plan of merger with case for $4.3 billion. prior to the merger, the market for four wheel drive tractors consisted of five firms. the market was highly concentrated, with herfindahl-hirschman index of 2,915. case's share of that market was 13 percent, while fiat comprised just 7 percent of the market. if approved, by how much would the post merger herfindahl-hirschman index increaseSomeone please clear my doubt.I have posted question and got answer,i attached the ques and ans(refer image). I can't understand how q1=19800 and q2=0 in equilibrium when the two actors have the same cost and revenue functions and they act simultaneously in a one-shot game. Intuitively one would guess that a cournot equillibrium would occur when q1=q2. Am I wrong i assuming that there can be no "player business that chooses to produce first" in a one-shot simultaneous game? What am i not understanding?
- Consider the following strategic game with 2 players: P1 AND P2 E F G H A 10,30 0,50 5,5 40,20 B 40,10 10,10 8,20 30,5 C 15,5 10,30 5,20 25,20 D 20,3 20,8 6,6 20,0 (a) Specify the strategies for P1 and P2, respectively. Eliminate all strictlydominated strategies, and FIND the reduced game until you can reduce the game nofurther.(b) Find all the Nash equilibria for the reduced game, including the mixed-strategy onesExamine the payoff matrix below which involves two beverage companies: “Pepsi and Coke”. The dollar values within the cells represent profit values from advertising strategies under different scenarios. Determine Pepsi’s “dominant strategy”.Game theory TITAN is the dominant steel producer in the US, but its global competitor GIANTS has gained some sizeable market share in the US recently by expanding into US via acquisitions. TITAN currently has a 40,000-ton capacity plant and GIANTS has two plants - a 16,000-ton plant and a 4,000-ton plant. Suppose these are the only two producers of steel in the US. The current market price is $5M per 1000 tons, and variable costs are $2M per 1000 tons. Assume fixed costs are negligible relative to variable costs, and the quality of steel produced across plants is identical. At current market price there is significant overcapacity, so each firm only produces 50% of its total capacity, i.e. the production level for TITAN is 20,000 tons and that for GIANTS is 10,000 tons respectively. Marketing research had indicated that lowering the price to $4M per 1000 tons while the other firm maintained its price at $5M would shift half of the other firm’s demand to the firm with the lower price.…
- Assume there are two firms X and Y, considering which of two alternative prices to charge, £25 or £19 for X and £20 or £15 for Y. The firms make their decisions simultaneously: i.e. neither firm knows the price choice of its rival. The various profits are illustrated in the following pay-off matrix: Strategies and payoffs for X are in blue and for Y in red. (a) What is firm Y’s best response to each of the two different prices firm X could charge? Does firm Y have a dominant strategy? (b)What is firm X’s best response to each of the different prices firm Y could charge? Does firm X have a dominant strategy? (C) What is/are the Nash equilibrium/equilbria? What is the most likely outcome of this game? Explain your answer.Two identical firms are engaged in Cournot competition, with cost functionsTCA(QA) = 10 QA and TCB(QB) = 10 QB. The market demand is given by P = 610 –2Q.a) Plot the best response functions and report the Cournot-Nash equilibrium quantities, price and profits.b) What are the prices, quantities, and profits for the firms if they decide to collude and share profits equally? c) Show that firms have an incentive the deviate from the collusive outcome.d) Find the Stackelberg equilibrium if A leads and B follows.e) Show the equilibria in the previous parts on the inverse demand function. Calculate and identify consumer surplus and deadweight loss in each equilibrium..Please no written by hand Two supermarkets, Apple Mart and Family Fresh compete against each other. Due to the improvement in AI, they are both are considering switching from Cashier lanes to the use of only Self-check machine lanes. Cost saving, customer response, and the interdependence between their strategies could result in the payoff metrix below. The first entry is for Apple Mart. i. Determine whether each store has a dominant strategy and state it below. If none, enter NONE:Apple Mart: _________________________________Family Fresh: _______________________________ii. Determine the Nash equilibrium (or equilibria).____________________________________________iii. What is the interpretation of your answer to ii?
