The daily demand for bungee jumping over a river in South Africa is given by Q=5000-200P. There are two firms operating and the first one has a daily capacity of 600 people and the second one of 400 people. The marginal cost of operation is 5 for both firms. The two firms compete in prices and announce their prices simultaneously. Calculate the price and profits of both firms.
The daily demand for bungee jumping over a river in South Africa is given by Q=5000-200P. There are two firms operating and the first one has a daily capacity of 600 people and the second one of 400 people. The marginal cost of operation is 5 for both firms. The two firms compete in prices and announce their prices simultaneously. Calculate the price and profits of both firms.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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![The daily demand for bungee jumping over a river
in South Africa is given by Q=5000-200P. There
are two firms operating and the first one has a
daily capacity of 600 people and the second one
of 400 people. The marginal cost of operation is 5
for both firms. The two firms compete in prices
and announce their prices simultaneously.
Calculate the price and profits of both firms.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F47974081-bd6e-4039-939e-4831433698ee%2F338f4cd0-546f-40aa-a485-b1dee4f2cff0%2Fcrt1itq_processed.jpeg&w=3840&q=75)
Transcribed Image Text:The daily demand for bungee jumping over a river
in South Africa is given by Q=5000-200P. There
are two firms operating and the first one has a
daily capacity of 600 people and the second one
of 400 people. The marginal cost of operation is 5
for both firms. The two firms compete in prices
and announce their prices simultaneously.
Calculate the price and profits of both firms.
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