Author Question: What is true of equilibrium in the game in Scenario 13.14? A) In equilibrium, both firms choose Q ... (Read 67 times)

tichca · **on:** Jul 1, 2018

What is true of equilibrium in the game in Scenario 13.14?

A) In equilibrium, both firms choose Q = 50.
B) In equilibrium, both firms choose Q = 100.
C) There are two equilibria, at Q = 50 and at Q = 100.
D) The only equilibrium is in mixed strategies.
E) The two equilibria are those associated with the (40,30 ) outcome and the (30,40 ) outcome.

Question 2

DVDs can be produced at a constant marginal cost of 10 per disk, and Roaring Lion Studios is releasing the DVDs for its last two major films. The DVD for Rambeau 17 is priced at 20 per disk, and the DVD for Schreck 10 is priced at 30 per disk.

What are the Lerner indices for these two movies? A) Both equal one.
B) 2 and 3, respectively
C) 0.5 and 0.67, respectively
D) 1 and 2, respectively