Consider a monopolistic competitive industry with 4 firms producing the same good. The (inverse) demand for the good is given as: p=30-Q where Q is total units of the good produced by the firms: Q =q₁. Each firm chooses their output qi to maximize profits. The cost of producing q units of output is the same for all firms: C(q) = 6qi for all i = 1, ..., 4. (a) Suppose all 4 firms choose their outputs at the same time (i.c., Cournot model), what will be the profit-maximizing outputs for each firm. [Note: Firms are iden- tical and face the same demand curve, hence model is symmetric] (b) Now consider a Stackelberg model in which 3 of the 4 firms (say, firms 1, 2 and 3) are already in the industry, hence act as Stackelberg leaders. That is, the 3 firms choose their outputs 91, 92, 93 at the same time in Stage 1 of the model. Then in Stage 2, the 4th firm (the follower) produces her output 9₁. Solve for the profit-maximizing quantitics 91, 92, 93, 94 in this Cournot-Stackelberg model. What is the total output Q and the price of the good?

Consider a monopolistic competitive industry with 4 firms producing the same good. The (inverse) demand for the good is given as: p=30-Q where Q is total units of the good produced by the firms: Q =q₁. Each firm chooses their output qi to maximize profits. The cost of producing q units of output is the same for all firms: C(q) = 6qi for all i = 1, ..., 4. (a) Suppose all 4 firms choose their outputs at the same time (i.c., Cournot model), what will be the profit-maximizing outputs for each firm. [Note: Firms are iden- tical and face the same demand curve, hence model is symmetric] (b) Now consider a Stackelberg model in which 3 of the 4 firms (say, firms 1, 2 and 3) are already in the industry, hence act as Stackelberg leaders. That is, the 3 firms choose their outputs 91, 92, 93 at the same time in Stage 1 of the model. Then in Stage 2, the 4th firm (the follower) produces her output 9₁. Solve for the profit-maximizing quantitics 91, 92, 93, 94 in this Cournot-Stackelberg model. What is the total output Q and the price of the good?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

p (a) MC ATC MR P* (b) MC ATC MR (c) MC ATC MR
None
Prepare a flow chart for a typical family of 4 (3 drivers), taking a two-week (Monday is 1st-14th is a Sunday) vacation driving from New York to Orlando in August. Your return to workday is 15th of the month which is a Monday. Discuss areas of concerned revealed by the flow chart.
Subject - advanced math Frank's loan pay off is to be made in two installments: $2500 in a year, and $3500 in 3 ½year. After talking to his loan officer, it was decided that he could pay both installments in 20months. How much would he pay if his loan is processed at 7 ¼ simple interest. Draw a timelineto illustrate your solution.
Typed plz and asap thanks
(1) three year ago , meghan bought stock in GE for $25.69 per share . the stock is now worth $145.85 per share. there were no stock split. calculate the compaund annual growth rate for her investment (a) 178.4% (b) 76.3% (c) 82.99% (d) 78.39% (e) 43.9%
Which of the following is different? A. present value B. accumulated amount C. Future Value D. Maturity Value
Q3/ A manufacturing company supplies 24000 units in the first half of the year and the order cost is 300$ per order, the holding cost 60$. Find a. What is the most economical order quantity ? b. How many orders need to be placed ?
You deposit $5000 into an account that will grow to $14,930 in 6 years. Your rate of return on this investment is closest to what value? (a) 18% (b) 20% (c) 22% (d) 25%