The Four Basic Assumptions of Markov Analysis Are

question 65

True/False

The four basic assumptions of Markov analysis are:
1.There are a limited or finite number of possible states.
2.The probability of changing states remains the same over time.
3.A future state is predictable from previous state and transition matrix.
4.The size and makeup of the system are constant during analysis.

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Definitions:

Cournot Equilibrium

Equilibrium in the Cournot model, in which each firm correctly assumes how much its competitor will produce and sets its own production level accordingly.

Competitive Equilibrium

A market state where supply equals demand, and no economic forces are compelling either price or quantity to change.

Oligopolistic

Referring to a market structure characterized by a small number of firms that have significant control over prices and market share.

Market

Collection of buyers and sellers that, through their actual or potential interactions, determine the price of a product or set of products.