Additional Problem 3: Assume two companies (C and D) are Cournot duopolists that produce identical products. Demand for the products is given by the following linear demand function: ? = 600 − ?C − ?D where ?C and ?D are the quantities sold by the respective firms and P is the price. Total cost functions for the two companies are ??C= 25,000 +100?C 2 ??D = 20,000 + 125?D c. Determine the equilibrium price and quantities sold by each firm. d.Determine the profits for the market as well as eachfirm.
Additional Problem 3: Assume two companies (C and D) are Cournot duopolists that produce identical products. Demand for the products is given by the following linear demand function: ? = 600 − ?C − ?D where ?C and ?D are the quantities sold by the respective firms and P is the price. Total cost functions for the two companies are ??C= 25,000 +100?C 2 ??D = 20,000 + 125?D c. Determine the equilibrium price and quantities sold by each firm. d.Determine the profits for the market as well as eachfirm.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Additional Problem 3:
Assume two companies (C and D) are Cournot duopolists that produce identical products.
Demand for the products is given by the following linear demand function:
? = 600 − ?C − ?D
where ?C and ?D are the quantities sold by the respective firms and P is theprice . Total cost
functions for the two companies are
??C= 25,000 +100?C
Assume two companies (C and D) are Cournot duopolists that produce identical products.
Demand for the products is given by the following linear demand function:
? = 600 − ?C − ?D
where ?C and ?D are the quantities sold by the respective firms and P is the
functions for the two companies are
??C= 25,000 +100?C
2
??D = 20,000 + 125?D
c. Determine theequilibrium price and quantities sold by each firm.
d.Determine the profits for the market as well as eachfirm.
??D = 20,000 + 125?D
c. Determine the
d.Determine the profits for the market as well as eachfirm.
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