(9) Suppose the market for tennis shoes has one dominant firm and five fringe firms. The market demand is Q= 400 – 2P. The dominant firm has a constant marginal cost of 20. The fringe firms each have a marginal cost of MC=20 + 5q. a. Verify that the total supply curve for the five fringe firms is Q, = P- 20. b. Find the dominant firm's demand curve. c. Find the profit-maximizing quantity produced and price charged by the dominant firm, and the quantity produced and price charged by each of the fringe firms.

(9) Suppose the market for tennis shoes has one dominant firm and five fringe firms. The market demand is Q= 400 – 2P. The dominant firm has a constant marginal cost of 20. The fringe firms each have a marginal cost of MC=20 + 5q. a. Verify that the total supply curve for the five fringe firms is Q, = P- 20. b. Find the dominant firm's demand curve. c. Find the profit-maximizing quantity produced and price charged by the dominant firm, and the quantity produced and price charged by each of the fringe firms.

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter9: Monopoly

Section: Chapter Questions

Problem 1QFR

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