An Essential Assumption of the Cournot Model Is That Each

question 53

Essay

An essential assumption of the Cournot model is that each firm aims to maximize profits, based on the expectation that its own output decision will not have an effect on the decisions of its rivals. Critically evaluate this assumption.

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Definitions:

Chronic

Relating to illnesses that persist for a long time or are constantly recurring.

Disenfranchised

Refers to individuals or groups who feel deprived of rights or privileges, often leading to a sense of alienation and disenchantment.

Exaggerated

Something that is overstated or represented more intensely or dramatically than is the actual case.

Masked

Hidden or concealed, often referring to symptoms or conditions that are not immediately apparent or are disguised as something else.