(14.19) Consider two neighboring wineries in fierce competition over the production of their specialty wine (where their grapes come from the same vineyard, so we assume that their wines are regarded as identical by customers). One winery is owned by Jill(J), and the other by Ray (R). Each winery produces its wine the same way and have symmetric TC function TC;(q;) = 3 + 0.5g;. Inverse market demand for wine is p = 50 – 2(qj + qr). - If the firms compete la Cournot, what is each winery's equilibrium output and price? O (5.5, $10) (8.25, $17) O (4.25, $12) (6.75. $8)
(14.19) Consider two neighboring wineries in fierce competition over the production of their specialty wine (where their grapes come from the same vineyard, so we assume that their wines are regarded as identical by customers). One winery is owned by Jill(J), and the other by Ray (R). Each winery produces its wine the same way and have symmetric TC function TC;(q;) = 3 + 0.5g;. Inverse market demand for wine is p = 50 – 2(qj + qr). - If the firms compete la Cournot, what is each winery's equilibrium output and price? O (5.5, $10) (8.25, $17) O (4.25, $12) (6.75. $8)
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:(14.19) Consider two neighboring wineries in fierce competition over the
production of their specialty wine (where their grapes come from the same
vineyard, so we assume that their wines are regarded as identical by
customers). One winery is owned by Jill(J), and the other by Ray (R). Each
winery produces its wine the same way and have symmetric TC function
TC;(q;) = 3 + 0.5g;. Inverse market demand for wine is
p = 50 – 2(qj + qr).
-
If the firms compete la Cournot, what is each winery's equilibrium output
and price?
O (5.5, $10)
(8.25, $17)
O (4.25, $12)
O (6.75, $8)
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