Explain the meaning of a nash equilibrium

Assignment Help Business Economics

Reference no: EM13818489

Explain the meaning of a Nash equilibrium when rms are competing with respect to price. Why is the equilibrium stable? Why don’t the firms raise prices to the level that maximizes joint prots? What is the DWL in this model?

Reference no: EM13818489

Questions Cloud

Result of the production subsidy : The nation of Acirema is “small” unable to affect world prices. It imports peanuts at a world price of $10. Now suppose Acriema imposes a production subsidy of $2 per unit produced by Acriema’s firms. Calculate and graph the new equilibrium with the ..

Output between two geographically separated markets : A monopolist is deciding how to allocate output between two geographically separated markets. Demand and marginal revenue for the two markets are: The monopolists total cost is C = 5 - 3(Q1 + Q2 ). What are price, output, profits, marginal revenues, ..

Consider two firms facing the demand curve : Consider two firms facing the demand curve P = 50 - 5Q where Q = Q1 +Q2 . The rms cost functions are C1 (Q1 ) = 20 + 10Q1 and C2 (Q2 ) = 10 + 12Q2. If they collude, how much will each firm produce? What would be each firm's profit?

Examine any legal implications in creating a training course : Examine any legal implications in creating a training course that discusses culture. Identify what laws and regulations should be considered. Explain how the demographic diversity of your employees affects discussions of cultural diversity. Examine w..

Explain the meaning of a nash equilibrium : Explain the meaning of a Nash equilibrium when rms are competing with respect to price. Why is the equilibrium stable? Why don’t the firms raise prices to the level that maximizes joint prots? What is the DWL in this model?

Consider monopolistic firm-produce any quantity : Consider a monopolistic firm that can produce any quantity of its product at a constant marginal cost equal to $20,000 and a fixed cost of $10 billion. Its products could be sold in two different markets: Europe and U.S.. What quantity should the fir..

Calculate rms degree of monopoly power using lerner ondex : A monopolist faces the demand curve Q = 11 - P . The monopolist has a constant average (and marginal) cost of $6 per unit.Draw the average and marginal revenue curves and the average and marginal cost curves. What are the monopolists profit-maximizin..

What is the welfare cost of monopoly : A monopolist faces the following demand curve: P = 120 - .02Q . The firms cost function is given by C = 60Q + 25; 000: Assume that the firm maximizes prots. What is the level of production, price, and total profit per week? What will be the level of ..

Economys production function-real wage-employment and output : Suppose the economy's production function is Y = A(300N – N^2). The marginal product of labor is MPN = A(300 - 2N). Suppose that A = 10. The supply of labor is NS = 0.05w + 0.005G. what are the real wage, employment, and output?

User Account

All Pages