How does simultaneous quantity choice differ from first-mover commitment?
Cournot intersects simultaneous best responses; Stackelberg substitutes the follower response into the leader’s profit.
Follow the cause and effect
Write firm i profit holding qj fixed and derive BRi(qj).
Solve BR1 and BR2 simultaneously for Cournot.
For Stackelberg, substitute the follower BR into leader profit and optimize.
The model you are using
Conditions for this model
Homogeneous product, equal constant marginal costs, no capacity constraints and no fixed cost.
The exam trap
The leader does not choose follower output directly; it anticipates a rational response.
Connect the reasoning to the graph
What changes
- A q1–q2 graph shows Cournot at BR intersection and Stackelberg on the follower BR.
What stays fixed
Homogeneous product, equal constant marginal costs, no capacity constraints and no fixed cost.
Keep these conditions throughout the comparison; change only what the case above specifies.
What to inspect
For Stackelberg, substitute the follower BR into leader profit and optimize.
Compare before and after, and locate the conclusion on the graph.
5 MINUTES · TRANSFER THE IDEA
Can you explain it without the lesson?
Compare Q and P under monopoly, Cournot, and Stackelberg in one linear market.