#OK to post homework #George Spahn, 2-6-2022, Assignment 4 # 5 # The monopoly is best. Since we are trying to maximize combined profits, # we can think of both company as a single company, which does the best # when the total produced is A/2 # 6 # i # See hw5GeorgeSpahn.txt , problem 6 # We look at s1, set d[1]=d, and multiply by A, to get # A/(d+1) #ii # By the previous part, we know that player 2 will produce (A-q1)/(d+1) # Thus player 1 has utility function ut1 := q[1]*(A - q[1] - (A - q[1])/(1 + d))^d: # Setting the derivative equal to 0. s := solve(diff(utp1,q[1])=0,q[1]): # s = A/(1 + d) # q1 = A/(1 + d) # q2 = (A - A/(1 + d))/(1 + d) # q2 = A*d/(1 + d)^2 # iii # See hw5GeorgeSpahn.txt , problem 5 # We set d[1] = d[2] = d, and multiply by A, to get # both players produce A/(d+2)