Microeconomics
posted by G on .
I am on the chapter for Oligopoly in my economic book.
I have the following question:
Define Nash equilibrium. What is the Nash equilbrium for trade policy?
I can define the Nash equilbrium. The Nash equilibrium is a situation in which economic actors interacting with one another each choose their best strategy given the stategies that all the other actors have chosen.
I am not clear on the second part of the question. What is the Nash Equilbrium for trade? The book does not state a Nash equilibrium for trade polocy.
Since in trade there would be many actors. I am not sure how to answer this part to the question?

The Nash equilibrium is that the best strategy for trade has been chosen given all the other countries have adopted a trade policy.

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