Consider Two Firms Engaged in Bertrand Competition with Differentiated Goods

question 89

Multiple Choice

Consider two firms engaged in Bertrand competition with differentiated goods and zero marginal costs.
Firm A's demand curve is q_A = 60 - 0.50P_A + 0.40P_B.
Firm B's demand curve is q_B = 72 - 0.50P_B + 0.40P_A.
In a Nash equilibrium, approximately how much profit does Firm A earn?

• A) $4,800
• B) $3,210
• C) $6,040
• D) $5,588

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Definitions:

Job Performance

The level of effectiveness and efficiency with which an employee fulfills their job responsibilities and tasks.

Happy Workers

Employees who experience positivity, satisfaction, and well-being in their workplace, contributing to higher productivity and retention.

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Employees who are efficient and effective in their work, contributing significantly to the organization's goals.

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The feeling of unhappiness or discontentment arising from one's job, often resulting from issues like poor working conditions, low pay, or lack of recognition.