The output of firms is determined simultaneously in Cournot competition but sequentially in Stackelberg competition.

Question

BlackTom AI · Accepted Answer

Consider the statement about how outputs are determined in two standard strategic-form competition models.
Option 1: Cournot. In Cournot competition, firms choose quantities simultaneously in each period, given beliefs about rivals' outputs, and then the market clears at a price determined by the total quantity. This simultaneity is a defining feature of Cournot models, as opposed to sequential moves.
Option 2: Stackelberg. In Stackelberg competition, firms move sequentially: a leader first chooses its output, observing the follower’s reaction, and the follower responds after the leader commits to a quantity. This sequential structure is the hallmark of the Stackelberg framework.
Putting the two together, the completed sentence with the given terms reads: The output of firms is determined simultaneously in Cournot competition but sequentially in Stackelberg competition. This matches the core characteristics of the two models, since Cournot relies on simultaneous quantity-setting, while Stackelberg relies on a leader–follower dynamic with sequential decisions.
If we think about potential misconceptions, one might confuse Stackelberg with a simultaneous-move game or recall that in dynamic models some notions of quantity can be modeled differently, but the essential distinction remains: Cournot is simultaneous, Stackelberg is sequential. There are no other options to consider here, as the statement hinges precisely on these two canonical definitions.

ECON3200001.1251 Quiz 13: Market Structures

The output of firms is determined simultaneously in Cournot competition but sequentially in Stackelberg competition.

View Explanation

Log in for full answers

Similar Questions

The output of firms is determined simultaneously in [選擇] Cournot Stackelberg competition but sequentially in [選擇] Stackelberg Cournot competition.

Match the following oligopoly model with its definition. 1: Cournot model 2: Price (Stackelberg) leadership model

In a consumer society, many adults channel creativity into buying things

Economic stress and unpredictable times have resulted in a booming industry for self-help products

People born without creativity never can develop it

A product has a selling price of $20, a contribution margin ratio of 40% and fixed cost of $120,000. To make a profit of $30,000. The number of units that must be sold is: Type the number without $ and a comma. Eg: 20000

Which of the following statement regarding cost is correct:

More Practical Tools for Students Powered by AI Study Helper

Homework AI Solver

Stylized AI Paper Writer

Plagiarism Checker Assistant

Citation AI Academic Writing Tool

In-Class Translation Assistant

AI Note Generator

AI Quiz Answers

Past Exam Questions from University Test Bank

Smart Practice Assistant

Adaptive Practice

Making Your Study Simpler