Asked by Derek Lewis on Jul 05, 2024
Verified
In Cournot equilibrium each firm chooses the quantity that maximizes its own profits assuming that the firm's rival will continue to sell at the same price as before.
Cournot Equilibrium
A situation in oligopoly markets where each firm chooses the quantity to produce to maximize its profit, assuming the quantities of its rivals are fixed.
- Master the initial concepts of Cournot and Bertrand models in the setting of oligopolistic markets.
Verified Answer
AL
Aleena LatimoreJul 11, 2024
Final Answer :
False
Explanation :
In Cournot equilibrium, each firm chooses the quantity that maximizes its own profits assuming that the rival's quantity will remain unchanged, not the price.
Learning Objectives
- Master the initial concepts of Cournot and Bertrand models in the setting of oligopolistic markets.
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