18. Explain why there can be multiple Nash equilibria in a game. (5 points) 19. First, describe what an oligopoly is. Second, explain why, when oligopolistic companies collude by forming a cartel, the typical outcome is higher consumer prices. Third, explain why cartel behavior is better for the companies that are part of the cartel than abandoning the cartel. Fourth, explain why cartels are difcult to sustain over time. (8 points total) 20. Consider Dixit's Chapter 2, Problem U4 (p.44, 5'h edition; p.44, 4'\" edition): Each of A, B, and C puts a dollar in the pot, and each tosses a quarter. A Wins if the coins land all heads or all tails. B wins if two head and one tail lands, and C wins if one head and two tails land. The quarters are fair. The winner receives a net payment of $2 and he losers lose their $1. (a) What it the probability that A will win and the probability that A will lose? (b) What is A's expected payoff? (c) What is the probability that C will win and the probability that C will lose? ((1) What is C's expected payoff? (e) Is this a constant-sum game? Explai\" "mm "mm\" '9 points/part; 15 points total) Open Ofce