Question 3 Suppose a market demand function is given by Qp(P) = 1,000- 10P. The product can be produced with a cost function C(Q) = 10,000 + 20Q. (a) Determine Q and P and the firm's profit if there is a single firm. (b) Determine total output Q, the equilibrium price, and the profit of each firm if there are two firms (i.e., a Cournot oligopoly). (c) Determine Q, the equilibrium price, and the profit of each firm if there are 10 firms.

Question 3 Suppose a market demand function is given by Qp(P) = 1,000- 10P. The product can be produced with a cost function C(Q) = 10,000 + 20Q. (a) Determine Q and P and the firm's profit if there is a single firm. (b) Determine total output Q, the equilibrium price, and the profit of each firm if there are two firms (i.e., a Cournot oligopoly). (c) Determine Q, the equilibrium price, and the profit of each firm if there are 10 firms.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter12: The Partial Equilibrium Competitive Model

Section: Chapter Questions

Problem 12.9P

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