part 10 11 12 The demand curves for cases of Coke and Pepsi are given respectively byQ.(Pc.Pe) = 200 - 10p. + 5pp.Qp(pc. Pp) = 200 - 10pp + 5pc.Consider the following figure familiar from the lecture on differentiated oligopoly.Each firm has a marginal cost of $10 per case and must simultaneously choose their prices.Are the following statements true or false?BA6. If Pepsi charges less than Coke, then all customers will buy from Pepsi.D7. Because Coke and Pepsi are substitutes, the best model for understanding this market is theCournot Competition Model.P2FFor the next question, note that Coke's revenue, as a function of price, isp2 - ARc(Pc.Pp) = Pc (200 - 10pc + 5pp).H8. Solving the equationP1Valuation for Firm 1 (v,)OkE (PePr) = 10Are the following statements true or false?for pc will yield Coke's best-response function.1. When prices are p, and p2, consumers in areas B, C, D, F, G, and I purchase from Firm 1.9. The best-response functions are pi(pp) = 15 + 0.25 pp and pi(pc) = 15 + 0.25 pc.2. When prices are p, and p, consumers in area H do not buy from either Firm.10. Both firms charging $20 is an equilibrium.3. When prices are p, and p2, consumers on the boundary between areas B and Careindifferent between purchasing the product from Firm 1 or Firm 2.4. Suppose Firms price is fixed at p, If Firm 2 changes its price from p, to p2 - 4 tconsumers in areas E, F, and G will switch from buying from Firm 1 to buying from Firm 2.5. Suppose there are no consumers in areas A and B, but there are consumers in all the otherregions, and suppose that Firm 2's marginal cost is zero. Then p, cannot be profitlindowsmaximizing for Firm 2.Valuation forFirm 2 (vz) The equilibrium outcome of the Leader-Follower model of duopoly has the leader behavingmore aggressively than it would in the simultaneous version of the game (i.e., in Coumatduopoly)- The leader also enjoys first-mover advantage in that its profit is higher than that ofthe follower when the firms' marginal costs are the same. These predictions derive from thefact that, in this market, mare aggressive play by one firm (ie, a higher quantity) elicits a lessaggressive response (a lower quantity) from its competitor as each firm's best responsequantity is decreasing in the competitor's quantity. Economists refer to this by saying that thefirms' products are strategic substitutes.The graph below lustrates the equilibria of the Competition Game and the Cooperation Gamein a setting of the sort described in Lecture 4. That is, both divisions have (potentially different)marginal costs and face a demand system of the formQ.(P-P) -k -b P. +b PBLUEBLUEREDIn markets where the opposite is true-more aggressive play elicits a more aggressiveresponse-the firms' products are instead said to be strateglc complements, and the aboveREDpredictions are reversed.To illustrate, consider differentiated price competition between Fims A and B sellingdifferentiated products. The demand faced by Firm A is Qa (Pa. Pa) = 96 – 2pa + Pa, and thedemand faced by Firm Bis Qa(Pa Pa) = 96 – 2p, + Pa, where p, is the price charged by FirmA and pa is the price charged by Firm B. Both firms have a constant marginal cost equal to 40.In the simultaneous-move version of the game, the firms choose prices independently, notobserving the competitor's price before choosing their own. In the sequential move version ofthe game, Firm A commits to its price first, and Firm B then chooses its own price, havingobserved that of Firm A.Are the following statements true or false?Division 1's best-responses are blue, while Division 2's best-responses are red. Are the following11. in the simultaneous-move version of the game, if Firm A conjectures that Firm B will drop itsprice, then Firm A best-responds by dropping its price as well. In other words, the productsstatements true or false?are strategic complements.16. The price level indicated by Line Dis equal to the marginal cost of Division 1.12. The Nash equilibrium of the simultaneous-move game has both firms charging the price 7017. The dashed lines represent competitive best-responses.and eaming a profit equal to 780.18. In the equilibrium of the Cooperation Game, Division 2 choses price level A and Divisian 113. In the sequential-move version of the game, Firm B's best response to the price of Firm A isthe same as in the simultaneous-move version of the game.chooses price level G.14. In the equilbrium of the sequential-move version af the game, firm A charges 60 and firm Bcharges 59.19. In the equilibrium of the Cooperation Game, Division 2 chooses price level B and Division 1chooses price level F.20. In the equilibrium of the Cooperation Game, Division 2 chooses price level Cand Division 1"Activate WihdGo to Settings to a15. In the sequential-move version of the game, it is better to be the first mover than thechooses price level Esecond mover.

Question

part 10 11 12 The demand curves for cases of Coke and Pepsi are given respectively byQ.(Pc.Pe) = 200 - 10p. + 5pp.Qp(pc. Pp) = 200 - 10pp + 5pc.Consider the following figure familiar from the lecture on differentiated oligopoly.Each firm has a marginal cost of $10 per case and must simultaneously choose their prices.Are the following statements true or false?BA6. If Pepsi charges less than Coke, then all customers will buy from Pepsi.D7. Because Coke and Pepsi are substitutes, the best model for understanding this market is theCournot Competition Model.P2FFor the next question, note that Coke's revenue, as a function of price, isp2 - ARc(Pc.Pp) = Pc (200 - 10pc + 5pp).H8. Solving the equationP1Valuation for Firm 1 (v,)OkE (PePr) = 10Are the following statements true or false?for pc will yield Coke's best-response function.1. When prices are p, and p2, consumers in areas B, C, D, F, G, and I purchase from Firm 1.9. The best-response functions are pi(pp) = 15 + 0.25 pp and pi(pc) = 15 + 0.25 pc.2. When prices are p, and p, consumers in area H do not buy from either Firm.10. Both firms charging $20 is an equilibrium.3. When prices are p, and p2, consumers on the boundary between areas B and Careindifferent between purchasing the product from Firm 1 or Firm 2.4. Suppose Firms price is fixed at p, If Firm 2 changes its price from p, to p2 - 4 tconsumers in areas E, F, and G will switch from buying from Firm 1 to buying from Firm 2.5. Suppose there are no consumers in areas A and B, but there are consumers in all the otherregions, and suppose that Firm 2's marginal cost is zero. Then p, cannot be profitlindowsmaximizing for Firm 2.Valuation forFirm 2 (vz) The equilibrium outcome of the Leader-Follower model of duopoly has the leader behavingmore aggressively than it would in the simultaneous version of the game (i.e., in Coumatduopoly)- The leader also enjoys first-mover advantage in that its profit is higher than that ofthe follower when the firms' marginal costs are the same. These predictions derive from thefact that, in this market, mare aggressive play by one firm (ie, a higher quantity) elicits a lessaggressive response (a lower quantity) from its competitor as each firm's best responsequantity is decreasing in the competitor's quantity. Economists refer to this by saying that thefirms' products are strategic substitutes.The graph below lustrates the equilibria of the Competition Game and the Cooperation Gamein a setting of the sort described in Lecture 4. That is, both divisions have (potentially different)marginal costs and face a demand system of the formQ.(P-P) -k -b P. +b PBLUEBLUEREDIn markets where the opposite is true-more aggressive play elicits a more aggressiveresponse-the firms' products are instead said to be strateglc complements, and the aboveREDpredictions are reversed.To illustrate, consider differentiated price competition between Fims A and B sellingdifferentiated products. The demand faced by Firm A is Qa (Pa. Pa) = 96 – 2pa + Pa, and thedemand faced by Firm Bis Qa(Pa Pa) = 96 – 2p, + Pa, where p, is the price charged by FirmA and pa is the price charged by Firm B. Both firms have a constant marginal cost equal to 40.In the simultaneous-move version of the game, the firms choose prices independently, notobserving the competitor's price before choosing their own. In the sequential move version ofthe game, Firm A commits to its price first, and Firm B then chooses its own price, havingobserved that of Firm A.Are the following statements true or false?Division 1's best-responses are blue, while Division 2's best-responses are red. Are the following11. in the simultaneous-move version of the game, if Firm A conjectures that Firm B will drop itsprice, then Firm A best-responds by dropping its price as well. In other words, the productsstatements true or false?are strategic complements.16. The price level indicated by Line Dis equal to the marginal cost of Division 1.12. The Nash equilibrium of the simultaneous-move game has both firms charging the price 7017. The dashed lines represent competitive best-responses.and eaming a profit equal to 780.18. In the equilibrium of the Cooperation Game, Division 2 choses price level A and Divisian 113. In the sequential-move version of the game, Firm B's best response to the price of Firm A isthe same as in the simultaneous-move version of the game.chooses price level G.14. In the equilbrium of the sequential-move version af the game, firm A charges 60 and firm Bcharges 59.19. In the equilibrium of the Cooperation Game, Division 2 chooses price level B and Division 1chooses price level F.20. In the equilibrium of the Cooperation Game, Division 2 chooses price level Cand Division 1&#34;Activate WihdGo to Settings to a15. In the sequential-move version of the game, it is better to be the first mover than thechooses price level Esecond mover.

Accepted Answer

We’ll answer the first question (containing part 10th) as there are multiple questions. Please…