Question: Ch5 Problem 4: Repeated entry deterrences Assume that Entry Deterrence I is repeated an infinite number of times, with a tiny discount rate and with

Ch5 Problem 4: Repeated entry deterrences Assume that Entry Deterrence I is repeated an infinite number of times, with a tiny discount rate and with payoffs received at the start of each period. In each period, the entrant chooses Enter or Stay Out even if he entered previously. (a) What is the perfect equilibrium in which the entrant enters each period? Answer: (b) Why is (Stay Out, Fight) not a perfect equilibrium? Answer: (c) What is a perfect equilibrium in which entrant never enters? Answer: (d) What is the maximum discount rate for which your strategy profile in (c) is still an equilibrium

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