A duopoly faces an inverse market demand of: p= 390 - 34, - 302. You are told that firm 1 is the leader and firm 2 is the follower. Otherwise the firms are identical, each with a constant marginal cost of $90. What oligopoly model will you use to analyze this market? The Stackelberg model At the Nash equilibrium, firm 1 will produce 60.0 units. (Round your answer to one decimal place.) At the Nash equilibrium, firm 2 will produce 30.0 units. (Round your answer to one decimal place.)

A duopoly faces an inverse market demand of: p= 390 - 34, - 302. You are told that firm 1 is the leader and firm 2 is the follower. Otherwise the firms are identical, each with a constant marginal cost of $90. What oligopoly model will you use to analyze this market? The Stackelberg model At the Nash equilibrium, firm 1 will produce 60.0 units. (Round your answer to one decimal place.) At the Nash equilibrium, firm 2 will produce 30.0 units. (Round your answer to one decimal place.)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Q16
part CD
Suppose the airline industry is an oligopoly with two competing firms, VolAir and ClearJet. Assume each airline sells tickets that are virtually identical and customers have no loyalty to either airline. Possible pricing outcomes in the market are displayed on the graph to the left, while the two airlines best response functions according to the Cournot model are shown on the graph to the right. Price per ticket MR Qc Tickets per year Demand MC VolAir sells 600, and ClearJet sells 600. VolAir sells 480, and ClearJet sells 1,200. VolAir sells 1,200, and ClearJet sells 480. Tickets sold by Clearlet VolAir sells 750, and ClearJet sells 750. 2000 1200- 0 VolAir's best response Clearlet's best response Suppose VolAir's best response function is Qv= 1,200-0.60c and ClearJet's best response function is Qc = 1,200- 0.607. How many tickets does each airline sell in the Nash equilibrium? 2000 1200 Tickets sold by VolAir