August and Franois are the only sellers of sparkling water at a market in a small, rural

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August and François are the only sellers of sparkling water at a market in a small, rural French town. They obtain their sparkling water for free from wells in their backyards, and transport it to the market in wheelbarrows; neither has access to motorized transportation. Identify the type of oligopoly (Cournot, Bertrand, Stackelberg) that is the best fit for each situation below, and explain your reasoning:
a. August and François both live four hours' walk from the market.
b. August and François both live half a block from the market.
c. August lives a long walk away, but is an early riser who always arrives at 8:00 am; François lives quite close and never shows until 8:30.
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Microeconomics

ISBN: 978-1464187025

2nd edition

Authors: Austan Goolsbee, Steven Levitt, Chad Syverson

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