Duopoly quantity setting firms face the market demand p=150- q. each firm has a marginal cost of £60 per unit. what is the stackelberg equilibrium when firm 1 moves first? i). q1 =30, q2 =30, p=90. ii). q1 =45, q2 =22.5, p=82.5. iii). q1 =35, q2 =30, p=100. iv). q1 =40.5, q2 =25.5, p=70.
d. what is the advantage to mixed strategies? they i). allow a player to be unpredictable. ii). allow a player to raise his maximin payoff. iii). are needed to guarantee the existence of equilibrium. iv). all of the above.
e. lotteries a and b have the same expected value, but b has larger variance. which of the following is true? i). some risk averse decision makers will prefer lottery a while others will prefer lottery b. ii). all risk averse decision makers will prefer lottery b to lottery a. iii). some risk neutral decision makers will prefer lottery a while others will prefer lottery b. iv). none of the above.
f. which of the following is the present value of £1 payable in three years is: i). £1 ii). £1/(1+3r) iii). £1/(1-3r) iv). £1/(1+r)3