Divisionalization with asymmetric production costs

We study a standard duopoly model of simultaneous divisionalization and Cournot competition, assuming that firms have different marginal costs divisions are costless. obtain in equilibrium only the efficient firm active because price is equal to cost inefficient firm. In sequential case, however, this “entry-deterrence” strategy profitable for when its advantage important enough. So our setting, both coexist difference small enough chosen sequentially.