. for two firms that share a market if demand p=300-q where q is the total quantity sold and fixed cost is 300 and MC is 20 and suppose if the firms are in collusion and the first firm decides to cheat ,how much will the first firm produce ,what will its "p "  be and profit be and how much will it exceed the second firm.Also then if both firms collude but both cheat then what will each firm make profit?

Principles of Economics, 7th Edition (MindTap Course List)
7th Edition
ISBN:9781285165875
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter16: Monopolistic Competition
Section: Chapter Questions
Problem 4PA
icon
Related questions
Question

3. for two firms that share a market if demand p=300-q where q is the total quantity sold and fixed cost is 300 and MC is 20 and suppose if the firms are in collusion and the first firm decides to cheat ,how much will the first firm produce ,what will its "p "  be and profit be and how much will it exceed the second firm.Also then if both firms collude but both cheat then what will each firm make profit?

Expert Solution
steps

Step by step

Solved in 2 steps

Blurred answer
Recommended textbooks for you
Principles of Economics, 7th Edition (MindTap Cou…
Principles of Economics, 7th Edition (MindTap Cou…
Economics
ISBN:
9781285165875
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Principles of Economics (MindTap Course List)
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Principles of Microeconomics (MindTap Course List)
Principles of Microeconomics (MindTap Course List)
Economics
ISBN:
9781305971493
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Principles of Economics 2e
Principles of Economics 2e
Economics
ISBN:
9781947172364
Author:
Steven A. Greenlaw; David Shapiro
Publisher:
OpenStax
Principles of Microeconomics
Principles of Microeconomics
Economics
ISBN:
9781305156050
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Exploring Economics
Exploring Economics
Economics
ISBN:
9781544336329
Author:
Robert L. Sexton
Publisher:
SAGE Publications, Inc