Two firms sell substitutable products; the market price is: P = 90-Q, where Q Q1 + Q₂ is the total market quantity, which consists of Q₁ (the quantity produced by Firm 1) and Q₂ (the quantity produced by Firm 2). The firms choose their quantities simultaneously. Firm 1's costs are C₁ = 10- 6Q₁ + Q². Firm 2's costs are C₂ = Q². Which is the payoff function for Firm 2? O 3 π₂ = 90Q₂-0²-Q192. Which is the best response function for Firm 1? O π₂ = 90Q₂ - Q². π₂ = 45 - Q² - Q₁ Q2. π₂ = 45 - 1²/0²/₁ Q₁ = 16. Q₁ = 32 - ²/Q₂. 2 Q₁ = 40 + ²0₂₁ 3 Q₁ = 45. =

Two firms sell substitutable products; the market price is: P = 90-Q, where Q Q1 + Q₂ is the total market quantity, which consists of Q₁ (the quantity produced by Firm 1) and Q₂ (the quantity produced by Firm 2). The firms choose their quantities simultaneously. Firm 1's costs are C₁ = 10- 6Q₁ + Q². Firm 2's costs are C₂ = Q². Which is the payoff function for Firm 2? O 3 π₂ = 90Q₂-0²-Q192. Which is the best response function for Firm 1? O π₂ = 90Q₂ - Q². π₂ = 45 - Q² - Q₁ Q2. π₂ = 45 - 1²/0²/₁ Q₁ = 16. Q₁ = 32 - ²/Q₂. 2 Q₁ = 40 + ²0₂₁ 3 Q₁ = 45. =

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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