Thus, total quantity, Q = q1 + q2, the sum of what each firm produces, and profit (payoff) per firm (same for both), (pi)1 = (P MC)xq1 = [(6 Q) 1]xq1 = [5 (q1 + q2)]=q1
a) Cournot Duopoly: Each firm chooses a discrete quantity: 0, 1, 2, or 3. Present the game
in matrix form, and find its pure strategy Nash equilibria. Are there any dominant or
dominated strategies for either player?
b) Bertrand Duopoly: Each firm can choose any price. What is/are the Nash equilibrium/a?
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