Price dispersion leads to higher profits for lower-priced firms.
Firms can charge different prices even if they have the same costs. Lower-priced firms make more money in this scenario. The price range widens as more firms enter the market, with the highest price being like a monopoly and the lowest close to cost. Even with many firms, prices stay higher than costs on average. This pricing pattern stays the same whether prices are set at the same time or one after the other.