3(a - e)/4, is greater than aggregate quantity in the Nash equilib- rium of the Cournot game, 2(a - e)/3, so the market-clearing price is lower in the Stackelberg game.. Thus, i[r]
In contrast, classic producer theory assigns the producer a highly structured target function (profit function) but fewer constraints on the choice sets (technology or production functio[r]
3(a - e)/4, is greater than aggregate quantity in the Nash equilib- rium of the Cournot game, 2(a - e)/3, so the market-clearing price is lower in the Stackelberg game.. Thus, i[r]
for each player i the action a s
i belongs to A i .
◮ In the finitely repeated game G(T ) or the infinitely repeated
game G(∞, δ), a player’s strategy specifies the action the player will take in each stage, for every possible history of play.
(a) If an agent is risk averse, her risk premium is ALWAYS positive.
(b) When every player has a (strictly) dominant strategy, the strategy profile that consists of each player’s dominant strategy MUST be a Nash equilibrium. (c) If there are two Nash equilibria in pure-strategy, they can ALWAYS be Pareto
If the stage game has a unique NE, then for any T , the finitely repeated game has a unique SPNE: the NE of the stage game is played in every stage irrespective of the histor[r]
Both the Bertrand and Cournot models are particular cases of a more general model of oligopoly competition where firms choose prices and quantities (or capacities.). Ber[r]
payoff) while M gives 1 irrespective of player 1’s strategy.
Therefore, M is eliminated by mixing L and R .
After eliminating M , we can further eliminate D (step 2) and L
(step 3), eventually picks up ( U , R ) as a unique outcome.
If the stage game has a unique NE, then for any T , the finitely repeated game has a unique SPNE: the NE of the stage game is played in every stage irrespective of the histor[r]
e z . The prices of the three goods are given by (p, q, 1) and the consumer’s wealth is given by ω.
(a) Formulate the utility maximization problem of this consumer.
(b) Note that this consumer’s preference can be expressed in the form of U (x, y, z) = V (x, y) + z. Derive V (x, y).