Two Identical Firms Are Considering Entering a New Market That

question 38

Essay

Two identical firms are considering entering a new market that currently has no suppliers.The demand is large enough for both firms to make a positive profit.There are no fixed costs to enter.Explain how a simultaneous decision to enter on the part of the two firms will lead to a different outcome than a sequential entry decision.

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Definitions:

σ Bonds

The strongest type of covalent chemical bond formed from the head-on overlapping of atomic orbitals, which allows for the free rotation of the bonded atoms around the bond axis.

σ Molecular Orbital

A type of molecular orbital formed by the head-on overlapping of atomic orbitals, characterized by electron density along the axis connecting the nuclei of the atoms involved.

Nodes

Points along a standing wave where the wave has minimal amplitude. In quantum mechanics, it refers to points where the probability density of a particle is zero.

Carbon-Carbon

Describes bonds or interactions specifically between carbon atoms within molecules, crucial for organic chemistry.