oligopoly2-ho_001

oligopoly2-ho_001 - Bertrand Stackelberg Cartels Oligopoly...

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Unformatted text preview: Bertrand Stackelberg Cartels Oligopoly (contd.) Chapter 27 Bertrand Stackelberg Cartels Midterm 2 Bring pencil/pen, bluebook, pink scantron 8 MC questions, like last time Important skills: Find monopoly p , q Analyze effects of policy (e.g. tax, subsidy, price ceiling) on monopoly Max profits using price discrimination (lecture and especially workouts 25.5-8) Analyze duopoly (Cournot, Bertrand, Stackelberg, collusion) Bertrand Stackelberg Cartels Oligopoly Considerations: Do firms compete on price or quantity? Do firms act sequentially (leader/followers) or simultaneously (equilibrium) Stackelberg models: quantity leadership Cournot equilibrium models: simultaneous choice quantity competition Bertrand equilibrium models: simultaneous choice price competition Bertrand Stackelberg Cartels Today Price competition (Bertrand duopoly) More quantity competition Stackelberg Duopoly Cartels/collusion Bertrand Stackelberg Cartels Bertrand Duopoly: price competition Firms compete on price No clear leader, follower so firms effectively choose p simultaneously Take the other firms price as given Market demand determines equilibrium output Both choose same price: divide demand evenly One sets lower price: that firm captures entire market Bertrand Stackelberg Cartels Bertrand Duopoly: price competition Suppose two firms have same MC What price to charge? Bertrand Stackelberg...
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This note was uploaded on 12/26/2011 for the course ECON 100B taught by Professor Kilenthong during the Fall '08 term at UCSB.

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oligopoly2-ho_001 - Bertrand Stackelberg Cartels Oligopoly...

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