Consider a Cournot oligopoly with two firms, where the demand curves are given by P = 100-Q,-2Q2 P2= 100-2Q,-Q2 and that costs are given by TC(Q,) = Q',. MC, = 2Q1, TC(Q2) = Q²2, and MC2 = 2Q2. Also, marginal revenues can be written as MR, = 100- 2Q,-2Q2 MR2= 100- 2Q, - 2Q2. Solve for each firm's profit. Profit for firm 1= 600, Profit for firm 2= 300 Profit for firm 1= 300, Profit for firm 2= 600 Profit for firm 1= 555.55, Profit for firm 2= 555.55 Profit for firm 1= 0, Profit for firm 2= 0

Consider a Cournot oligopoly with two firms, where the demand curves are given by P = 100-Q,-2Q2 P2= 100-2Q,-Q2 and that costs are given by TC(Q,) = Q',. MC, = 2Q1, TC(Q2) = Q²2, and MC2 = 2Q2. Also, marginal revenues can be written as MR, = 100- 2Q,-2Q2 MR2= 100- 2Q, - 2Q2. Solve for each firm's profit. Profit for firm 1= 600, Profit for firm 2= 300 Profit for firm 1= 300, Profit for firm 2= 600 Profit for firm 1= 555.55, Profit for firm 2= 555.55 Profit for firm 1= 0, Profit for firm 2= 0

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter12: Price And Output Determination: Oligopoly

Section: Chapter Questions

Problem 1E

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