Problem
a) Consider the following two-player game.
Player 2
B1 B2 B3
A1 15, 2 10, 8 6, 4
Player 1 A2 9, 3 5, 7 3, 1
A3 12, 3 9, 8 17, 7
Would it be possible for player 1 to bribe player 2 to obtain an outcome that is better for both players? Explain.
b) In a certain market in the long-run, each firm and potential entrant has a long-run cost curve C(Q)=10Q^3 ?5Q^2 +20Q where Q is thousands of units per year. Market demand is given by D(P) = 39, 000 ? 2, 000P.
Suppose that the firms in this question produce using a technology that displays increasing returns to scale over the entire range of output. Sketch the long-run average and marginal cost curves. What issues arise in determining the long-run equilibrium in the market?
Can anyone help me out?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.