QUESTION 6Consider a Cournot duopoly with the following inverse demand function: P = 120 - Q1 - Q2, where Q1 and Q2 are quantities produced by firms 1 and 2, respectively. The firms'marginal cost are identical and given by MC;(Q;) = 3Qi, where i is either firm 1 or firm 2. Based on this information, firm 1's reaction function is Q1 = - 0.202.QUESTION 7Two identical firms compete as a Cournot duopoly. The inverse market demand they face is P = 96 - 5Q. The cost function for each firm is C(g) = 6q. The price charged in thismarket will be QUESTION 1A firm produces and sells ballI bearings in two distinct markets, each of which is completely sealed off from the other. The demand curve for the firm's output in the first market isP1=555-8Q1, where P1 is the price of the product and Q1 is the amount sold in the first market. The demand curve for the firm's output in the second market is P2=235-2Q2,where P2 is the price of the product and Q2 is the amount sold in the second market. The firm's marginal cost curve is 5+Q, where Q is the firm's entire output (destined for eithermarket). The firm should sellunits in the first market at the price ofandunits in the second market at the price ofto maximize its profit.

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QUESTION 6 Consider a Cournot duopoly with the following inverse demand function: P = 120 - Q1 - Q2, where Q1 and Q2 are quantities produced by firms 1 and 2, respectively. The firms' marginal cost are identical and given by MC;(Q;) = 3Qj, where i is either firm 1 or firm 2. Based on this information, firm 1's reaction function is Q1 = -0.2Q2.

QUESTION 6 Consider a Cournot duopoly with the following inverse demand function: P = 120 - Q1 - Q2, where Q1 and Q2 are quantities produced by firms 1 and 2, respectively. The firms' marginal cost are identical and given by MC;(Q;) = 3Qj, where i is either firm 1 or firm 2. Based on this information, firm 1's reaction function is Q1 = -0.2Q2.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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