The firms in a duopoly produce differentiated products. The inverse demand for Firm 1 is P1 = 52 -91 - 0.592. The inverse demand for Firm 2 is P2 = 130 - 92 - 0.5q1. Each firm has a marginal cost of m = $1 per unit. Solve for the Nash-Cournot equilibrium quantities. The Cournot equilibrium quantities are 91 = units and 92 = units. %3D (Enter your responses rounded to two decimal places.)

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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Q. 3
The firms in a duopoly produce differentiated products. The inverse demand for Firm 1 is
P1 = 52-91 - 0.592.
The inverse demand for Firm 2 is
P2 = 130 - 92 - 0.5q1.
Each firm has a marginal cost of m = $1 per unit. Solve for the Nash-Cournot equilibrium quantities.
The Cournot equilibrium quantities are
91
units
and
92
units.
%3D
(Enter your responses rounded to two decimal places.)
Transcribed Image Text:The firms in a duopoly produce differentiated products. The inverse demand for Firm 1 is P1 = 52-91 - 0.592. The inverse demand for Firm 2 is P2 = 130 - 92 - 0.5q1. Each firm has a marginal cost of m = $1 per unit. Solve for the Nash-Cournot equilibrium quantities. The Cournot equilibrium quantities are 91 units and 92 units. %3D (Enter your responses rounded to two decimal places.)
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