2. Two firms competing on output choice in an oligopolistic market face the following inverse market demand curve P = 100 – 1.5Q where Q = q1 + q2 Each firm faces a total cost function given as TC, = 6q1 %3D TC2 = 392 Assume the firms are Cournot competitors and determine the equilibrium quantity, price and profit for each firm.

Principles of Microeconomics
7th Edition
ISBN:9781305156050
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter17: Oligopoly
Section: Chapter Questions
Problem 1CQQ
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2.
Two firms competing on output choice in an oligopolistic market face the following inverse market demand
curve
P = 100 – 1.5Q where Q = q1 + 92
Each firm faces a total cost function given as
TC, = 6q1
TC, = 3q2
Assume the firms are Cournot competitors and determine the equilibrium quantity, price and profit for each firm.
Transcribed Image Text:2. Two firms competing on output choice in an oligopolistic market face the following inverse market demand curve P = 100 – 1.5Q where Q = q1 + 92 Each firm faces a total cost function given as TC, = 6q1 TC, = 3q2 Assume the firms are Cournot competitors and determine the equilibrium quantity, price and profit for each firm.
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