Suppose that the market demand for facial mud packs are given as follows: P = 2.200 - Q. Mud packs can be produced at no cost. Determine the level of output that would be produced by each firm in a cournot duopoly in the long run. Calculate th price charged for mud packs. Show all calculations.
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Suppose that the market demand for facial mud packs are given as follows: P = 2.200 - Q.
Mud packs can be produced at no cost. Determine the level of output that would be produced by each firm in a cournot duopoly in the long run. Calculate th price charged for mud packs. Show all calculations.
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- Suppose that the market demand for facial mud packs are given as follows: P = 2,200 – Q. Mud packs can be produced at no cost. Determine the level of output that would be produced by each firm in a Cournot duopoly in the long run. Calculate the price charged for mud packs. Show all calculationsThe market for dark chocolate us characterized by Cournot duopolists - Honeydukes and Wonka industries. The market demand for dark chocolate is: P = 8 - 0.005Qd where P is the price per bar in dollars and Qd is dark chocolate's daily quantity demanded in bars (use qh to represent the quantity of dark chocolate sold by Honeydukes and qw to represent the quantity of dark chocolate sold by Wonka Industries). Honeydukes has a constant marginal cost of $2.50 per bar, while Wonka Industries has a constant marginal cost of $3.00 per bar. The firms move simultaneously in choosing their profit-maximizing quantity of output. a. Given the firms move simultaneously, what is the equation for Honeydukes' reaction function with qh expressed as a function of qw? b. Given the firms move simultaneously, what is the equation for Wonka's reaction function with qw expressed as a function of qh? c. What quantity of dark chocolate will each firm produce in equilibrium and what price will be established for a…Suppose a country's mobile phone industry is supplied by only two firms (i.e. an oligopoly). Explain how the presence of two firms affects the price elasticity of demand of each firm's output.
- Consider a Cournot duopoly with the inverse demand P = 260 2Q. Two Örms compete choosing their quantities. Both Örms have constant marginal and average cost MC = AC = 20. Find each firms best response function. Find the Cournot equilibrium. c. Plot the best response curves and illustrate the equilibrium pointQUESTION 4: The graph below shows the demand and costs data for a one of firms operating in a market with a highly differentiated product/All underlying work must be shown MC ATC $11.50 $10.00 $9.00 $6.00 D MR 200 400 700 s00 Quantity A) Refer to the graph above. If the firm in the graph above maximizes profit, it will produce units of output and charge price per unit. A) 400; $10 B) 600; $6 C) 900; $9 D) 600; $11.50 B) Refer to the graph above. At the profit maximizing output level, the firm from above will earn: A) zero economic profit. B) $900 total economic profit. C) $2,700 economic profit. D) $2,700 economic loss. C) Refer to your answer above. You can conclude that if there are no barriers to entry: a) new fims will enter this industry in the long run in a search of profit. b) existing firms will exit this industry in the long run because of the short-run losses. c) this industry is in long-run equilibrium, and there are no incentives to enter or exit. d) the price per unit of…Two Cournot competitors face inverse demand p = 50-Q, where Q = 9₁ +92 is the total output of firms 1 and 2. Both firms have marginal cost of 2. What are the equilibrium output levels q₁ and 92? 16 and 16 25 and 25 20 and 9 36 and 3
- The market for knitted scarves at a local, weekend farmers' market is a Stackelberg duopoly. Sammy's Scarves acts as the Stackelberg leader and Knitting Nancy as the Stackelberg follower. Both Sammy and Nancy know that the market demand for knitted scarves at the farmers' market is: Q=320-4P where Q is the quantity of knitted scarves demanded and P is the price of a knitted scarf. Solving the market demand for P as a function of Q gives the inverse market demand: P-80-0.25Q. Sammy produces qs knitted scarves, and Nancy produces q knitted scarves. Each incurs a total cost of producing q; knitted scarves of TC (91)= =30+20q Sammy will sell 140 knitted scarves and Nancy will sell 70 knitted scarves at the local, weekend farmers' market.SUB-SECTION B2 13 Electra and Luminux are the only two firms who provide electricity in a local market as a Cournot duopoly. The electricity provided by the two firms is identical and consumers are indifferent about which firm they will purchase electricity from. The market inverse demand for electricity is P = 100 - 2Q, where is the aggregate quantity of electricity produced by the two firms, qe qL. Electra has a marginal cost of 12, while Luminux has a marginal cost of 20. Assume that neither firm has any fixed costs. (a) Determine each firm's reaction curve and graph it. How much electricity will each firm produce in a Cournot equilib- rium? (c) What will the market price for electricity be? How much profit does each firm make? (e) Suppose now that the two firms move sequentially with one of them acting as a Stackelberg leader. Do you expect the outcome to the closer to perfect competition when Electra, or when Luminux, moves first? Explain your answer.What is the homogeneous-good duopoly Cournot equilibrium if the market demand function is Q= 1,800 - 1,000p. and each firm's marginal cost is $0.28 per unit? The Cournot-Nash equilibrium occurs where q, equals and 92 equals (Enter numenic responses using real numbers rounded to two decimai places.) Furthermore, the equilibrium occurs at a price of $ (Round your answer to the nearest penny.)
- Consider the following Stackelberg duopoly. Both firms produce a homogenous good. Firm 1 chooses how much to supply first. Firm 2 chooses how much to supply after observing the quantity supplied by firm 1. The market demand is Q= 100 – 4 P. For firm i, the total cost of production is TC(q) =5q,+2. What is the optimal quantity supplied by firm 12 10 20 30 40 QUESTION 6 Consider the following Stackelberg duopoly. Both produce a homogenous good. Firm 1 chooses how much to supply first. Firm 2 chooses how much to supply after observing the quantity supplied from firm 1. The market demand is Q= 100 - 4P. For firm i, the total cost of production is TC(q) =5q,+2. What is the market clearing price? O 10 O 15 20 O 25Cournot duopolists face a market demand curve given by P = 60 – 1/2Q, where Q is total market demand in units. Each firm can produce output at a constant marginal cost of $15/unit. a) What is the equilibrium price and quantity produced by each firm? b) What if the firm's engaged in Bertrand competition? c) What if one of the firms chose its quantity before its competitor? What is the name for this sort of competition? d) Which of the three forms of competition gives the greatest social surplus?1. Consider two duopolists who each have a constant marginal cost c = e2 = 3 and face inverse demand P = 15 – Q,where Q = Q1 + Q2 is the total output of both firms. 1. Find the Cournot equilibrium quantity for each firm, the resulting market price, and the profits for each firm. 2. Find the Stackelberg equilibrium quantities for each firm, and the price, and the profits for each firm supposing that Firm 1 is the industry leader. 3. Suppose that Firm 2 figures out a way to lower its marginal cost to ez = 0 while firm 1 still has a marginal cost equal to 1: c = 3. How does this affect the Cournot equilibrium quantities, price, and profits? 4. How does this affect the Stackelberg equilibrium (with Firm 1 still as the leader) quantities, price, and profits?