Price Promotions - give away samples 2. Doesn't make sense for identical firms 2. If one firm has an advantage, it can make threats credible if it commits itslelf to output by building excess capacity. D. Investments to lower production costs 1. Period 1 firm A is a monopolist.
Firm B can enter in the second period.
Assume cournot duopoly for output if entry occurs. E. Raising rivals costs 1. Interference through government regulation 3. Raise switching costs - make it impossible to use computer programs written for one program to work on another. E. Delivered pricing - price including shipping is based on the distance from a specified location but not the location of the seller 1.