Question

firm a has a higher marginal cost than firm b. they compete in a homogeneous product bertrand duopoly. which of the following results will not occur? group of answer choices revenue of firm a < revenue of firm b qa < qb pricea < priceb profita < profitb

Answer 1

In a homogeneous product Bertrand duopoly, if Firm A has a higher marginal cost than Firm B, the result that will not occur is that revenue of Firm A is less than the revenue of Firm B.

Step-by-step explanation:

In a homogeneous product Bertrand duopoly, if Firm A has a higher marginal cost than Firm B, certain results will occur. The options given are:

1. Revenue of Firm A is less than the revenue of Firm B
2. Quantity supplied by Firm A is less than the quantity supplied by Firm B
3. The price set by Firm A is less than the price set by Firm B
4. Profit of Firm A is less than the profit of Firm B

Out of these options, the result that will not occur is that Revenue of Firm A is less than the revenue of Firm B. This is because in a homogeneous product market, when Firm A has a higher marginal cost, it will set a higher price, leading to higher revenue compared to Firm B.