Two airlines are competing against each other. Both raise prices at the same time and the...
Two airlines are competing against each other. Both raise prices at the same time and the market outcome is such that profits rise for both. Is this sufficient evidence that the two firms are colluding?
Homework Answers
can be mentioned that the given scenario is not a sufficient evidence to prove that the two firms are actually colluding and this is because of the fact that in a simultaneous game both racing the profits can be a part of nash equilibrium without colluding and the equilibrium can result in such a way that both can actually earn profits all in all.
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