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The Equilibrium of the Bertrand Model with Differentiated Goods Is

Question 109

Multiple Choice

The equilibrium of the Bertrand model with differentiated goods is found by:


A) setting price equal to marginal cost for each good.
B) setting quantity demanded equal to quantity supplied for each good.
C) solving for the intersection of the reaction curves in which each good's price is expressed as function of the other good's price.
D) solving for the intersection of the reaction curves in which each good's quantity is expressed as function of the other good's quantity.

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