Economics Q84

0. Which of the following models most likely describes a situation in which no firm can increase profits by changing its price/output choice?

  • Option : B
  • Explanation : The Cournot model describes a special case of Nash equilibrium, in which no firm can increase profits by changing its price/output choice. Kinked demand curve: Price at the kink in demand function. Dominant firm: Price at the quantity where MR = MC. Followers take the leader’s price.
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