A New Firm Enters a Market Which Is Initially Serviced

question 31

Multiple Choice

A new firm enters a market which is initially serviced by a Bertrand duopoly charging a price of $20. What will the new price be should the three firms coexist after the entry?

• A) $25
• B) $20
• C) $15
• D) None of the answers is correct.

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Definitions:

Insurance Company

An organization that provides a range of insurance policies to protect individuals and businesses against the risk of financial losses in return for regular payments of premiums.

Digital Transmission

The method of transferring data in the form of binary signals over a communication channel or computer network.

Fax Machine

A device used to send and receive documents over a telephone line using scanning and printing technology.

SOAP Documentation

A systematic method of documentation in healthcare using Subjective, Objective, Assessment, and Plan sections to record patient care.