Which of the following statements is correct? For the Bertrand model to generate

Question

Which of the following statements is correct?

For the Bertrand model to generate the Bertrand paradox, firms must have limited capacities.

One way to avoid the Bertrand paradox is to replace the assumption that firms have unlimited capacities with the assumptions that firms have limited capacities.

Another way to avoid the Bertrand paradox is to replace the assumption that the firms’ produce differentiated products with the assumption that firms’ products are identical.

All of the above.

For the Bertrand model to generate the Bertrand paradox, firms must have limited capacities.

One way to avoid the Bertrand paradox is to replace the assumption that firms have unlimited capacities with the assumptions that firms have limited capacities.

Another way to avoid the Bertrand paradox is to replace the assumption that the firms’ produce differentiated products with the assumption that firms’ products are identical.

All of the above.

Explanation / Answer

Answer: d

All Of the Above

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