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In: Economics

There are two main company(A, B) in a market. Their products are identical. The marginal cost...

There are two main company(A, B) in a market. Their products are identical. The marginal cost for producing is $3/1 product.

Qd = -2000P + 15000 (Demand curve)

What is a payoff matrix by finding two company’s profit if two company make a cartel and split the market equally?

What is a payoff matrix by finding two company’s profit if company A makes 1000 more product while company B keeps the previous agreement?

What is the Nash equilibrium in the two situation? The cartel is good or not for the two company? Why?

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Dear Student/ Learner, it was my great pleasure to help you solving this problem. I wish you best luck for your learning endeavour.
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Rahul Sunny answered 8 months ago
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