"If Firms in Duopoly Collude and Operate as a Monopoly

question 9

Essay

"If firms in duopoly collude and operate as a monopoly, the industry produces more output compared to the Nash equilibrium." True or false? Explain.

---

Definitions:

Fixed

Expenses that do not change in total over a short period, regardless of the level of production or sales activity, such as rent, salaries, or insurance.

Classified

Pertains to information, documents, or materials that have been deemed confidential and are restricted to certain levels of access.

Merchandising Company

A type of business that purchases finished goods and sells them to consumers without changing their form.

Gross Margin

A company's total sales revenue minus its cost of goods sold, divided by the total sales revenue, expressed as a percentage. It represents the proportion of each dollar of revenue that the company retains as gross profit.