Which of the Following Will Happen If a Firm in a Duopoly

question 206

Multiple Choice

Which of the following will happen if a firm in a duopoly with homogeneous products increases its price above its marginal cost once a Nash equilibrium is reached?

• A) The firm will earn huge economic profits.
• B) The firm will gain market share.
• C) The firm will lose all its customers to its rival.
• D) The firm will continue to earn zero economic profits.

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Definitions:

Relationships

Connections or associations between people, based on emotional bonds, interactions, or social ties.

Empathy

The ability to understand and share the feelings of another, putting oneself in their shoes emotionally.

Compassion

The emotional response to perceiving suffering and involves an authentic desire to help alleviate that suffering.

Narcissism

A personality trait characterized by excessive interest in oneself and one's physical appearance.