Dominance solvability in Bertrand's duopoly game:-
Consider the variant of Bertrand's duopoly game in Exercise, in which each firm is restricted to choose prices that are integral numbers of cents. Assume that the profit function (p - c)D(p) has a single local maximum. Show that the game is dominance solvable and find the set of surviving outcomes.
Exercise
Bertrand's duopoly game with discrete prices:-
Consider the variant of the example of Bertrand's duopoly game in this section in which each firm is restricted to choose a price that is an integral number of cents. Assume that c is an integral number of cents and that α > c + 1. Is (c, c) a Nash equilibrium of this game? Is there any other Nash equilibrium?