Question: Question 2 Consider a Cournot duopoly model where Ph + (22) = o- (11 + (12) in the relevant range of total output [11 +

Question 2

Consider a Cournot duopoly model where Ph + (22) = o- (11 + (12) in the relevant range of total output [11 + 9'2: with o. > 0. Suppose that each rm has probability 1/4 of having unit costs of CL and probability 3/4 of having unit costs of CH: where o. 2:} CH 2 CL 2+ 0. Solve for the symmetric Bayesian Nash equilibrium

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