Find the bayes nash equilibrium in the game/ Econometrics
Consider a Cournot model where the market demand is P = a – qA – qB. Both firms have constant average and marginal cost of c. Demand, however, is uncertain: it is high (a = aH) with probability f and low (a = aL) with probability 1 – f. Firm A has done a market study and knows whether demand is high or low, but Firm B does not. The two firms choose quantities simultaneously. Find the Bayes Nash equilibrium in this game.
