Given the same demand and cost conditions,_____ for a Stackelberg model as compared to a Cournot duopoly model.
A)total output is lower and price is higher
B)total output is higher and price is lower
C)total output and price are both lower
D)total output and price are both higher

Question

Quizplus · Accepted Answer

In a Stackelberg model, one firm acts as a leader and makes its output decision first, with the follower firm(s) then making their decisions. This typically results in a higher total output compared to a Cournot duopoly, where firms choose their outputs simultaneously without knowing the other's choice. The increased output in the Stackelberg model leads to a lower price compared to the Cournot model.

Given the Same Demand and Cost Conditions,_____ for a Stackelberg