Question 18 relies on the following information: Vendors A and B sell a homogenous good and simultaneously select where to locate on the boardwalk pictured below, with a number of customers in each location equal to the number in that cell. Customers purchase from whichever vendor is closest, and equidistant customers are split evenly. Location 2 Location 3 Location 4 Location 5 Location 7 Location 1 20 Location 6 10 20 2 20 10 20 In which location will Vendor A locate in equilibrium?

Question 18 relies on the following information: Vendors A and B sell a homogenous good and simultaneously select where to locate on the boardwalk pictured below, with a number of customers in each location equal to the number in that cell. Customers purchase from whichever vendor is closest, and equidistant customers are split evenly. Location 2 Location 3 Location 4 Location 5 Location 7 Location 1 20 Location 6 10 20 2 20 10 20 In which location will Vendor A locate in equilibrium?

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter15: Strategic Games

Section: Chapter Questions

Problem 10MC

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