What is one difference between the Cournot and Stackelberg models?
A) In Cournot, both firms make output decisions simultaneously, and in Stackelberg, one firm sets its output level first.
B) In Stackelberg, both firms make output decisions simultaneously, and in Cournot, one firm sets its output level first.
C) In Cournot, a firm has the opportunity to react to its rival.
D) Profits are zero in Cournot and positive in Stackelberg.

Question

Quizplus · Accepted Answer

In the Cournot model, both firms make output decisions simultaneously, while in the Stackelberg model, one firm sets its output level first and the other firm reacts to it.

What Is One Difference Between the Cournot and Stackelberg Models