A model of this situation with non-monotonic non-linear reaction functions was developed by David Rand and showed chaotic dynamics. The durability of a system of this type was demonstrated in a "linear city" model by Hotelling. Another model of this situation states that in absence of fixed costs of production, as N goes to infinity, price converges to marginal cost and was created after observation of a spring water market. A game that models this type of system has a leader and a (*) follower take turns making changes in production quantity; that game assumes perfect information and is named after Stackelberg. The two main models of this system differ in whether firms adjust price or quantity; these are the Bertrand and Cournot (coor-NO) models. Barriers to entry can ensure these systems
A model of this situation with non-monotonic non-linear reaction functions was developed by David Rand and showed chaotic dynamics. The durability of a system of this type was demonstrated in a "linear city" model by Hotelling. Another model of this situation states that in absence of fixed costs of production, as N goes to infinity, price converges to marginal cost and was created after observation of a spring water market. A game that models this type of system has a leader and a (*) follower take turns making changes in production quantity; that game assumes perfect information and is named after Stackelberg. The two main models of this system differ in whether firms adjust price or quantity; these are the Bertrand and Cournot (coor-NO) models. Barriers to entry can ensure these systems form and propagate. For 10 points, name this economic system in with only a few firms.
A model of this situation with non-monotonic non-linear reaction functions was developed by David Rand and showed chaotic dynamics.
duopoly [or oligopoly; do NOT accept "monopoly" or "monopsony"]