Order the answer to: You and your rival must simultaneously decide what price to

Best Writers business-economics Order the answer to: You and your rival must simultaneously decide what price to

business-economics

Order the answer to: You and your rival must simultaneously decide what price to

Question You and your rival must simultaneously decide what price to advertise in the weekly newspaper. If you each charge a low price, you each earn zero profits. If you each charge a high price, you each earn profits of $3. If you charge different prices, the one charging the higher price loses $5 and the one charging the lower price makes $5. a. Find the equilibrium when there are no repeated transactions. b. Now suppose there are repeated transactions. If the interest rate is 10 percent, what will be the outcome?
Subject business-economics
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