The next question has two parts. Part I. Consider a Cournot game among sellers of homogeneous products. Assume that demand is p=64-8Q, that each seller has a cost function C(q)=4q and that the cost of entering the market is K=5. How many firms would profitably enter the market? [Remark: n should be an integer number so writ your answer as an integer number rounding down; e.g. 5,8 firms rounds to 5 firms.]

The next question has two parts. Part I. Consider a Cournot game among sellers of homogeneous products. Assume that demand is p=64-8Q, that each seller has a cost function C(q)=4q and that the cost of entering the market is K=5. How many firms would profitably enter the market? [Remark: n should be an integer number so writ your answer as an integer number rounding down; e.g. 5,8 firms rounds to 5 firms.]

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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