Refer to the following figure.Two firms,A and B,produce similar,but not identical,products.BR_A and BR_B are,respectively,the reaction functions for firms A and B,which compete primarily by price. A's best-response curve shows

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A's best-response curve shows the price A should charge to maximize A's profits given each possible price that B might charge. It does not show all the Nash equilibrium prices that firm A can charge (A and B's best responses intersect at only one point on the graph) or how firm B should react to any price set by A (B's best-response curve would show this). It also does not show the price A should charge to maximize joint profits, as this would require knowledge of B's costs and profits.

Refer to the Following Figure