uppose two firms face market demand of P=150-Q, where Q=q1+q2 . Both firms have the same unit cost of 26. Assume the firms compete a la Stackelberg. Firm 1 is the leader and Firm 2 is the follower in this market. (a)What is the follower’s total revenue function? (b)Determine the equilibrium output level for both the leader and the follower. (c)Determine the equilibrium market price. (d)Determine the profits of the leader and the follower
uppose two firms face market demand of P=150-Q, where Q=q1+q2 . Both firms have the same unit cost of 26. Assume the firms compete a la Stackelberg. Firm 1 is the leader and Firm 2 is the follower in this market. (a)What is the follower’s total revenue function? (b)Determine the equilibrium output level for both the leader and the follower. (c)Determine the equilibrium market price. (d)Determine the profits of the leader and the follower
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Suppose two firms face market demand of P=150-Q, where Q=q1+q2 . Both firms have the same unit cost of 26. Assume the firms compete a la Stackelberg. Firm 1 is the leader and Firm 2 is the follower in this market.
(a)What is the follower’s total revenue function?
(b)Determine the equilibrium output level for both the leader and the follower.
(c)Determine the
(d)Determine the profits of the leader and the follower
(Please write clearly, thank you)
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