consider Atlanta as an oligopoly market with five airlines that behave in a Cournot Model fashion.  The Atlanta market demand schedule is: P = 400 - .5*Q. The Cost schedule for Delta is: MC=AC=Scomp=100. The Cost schedule for the other four firms (United, Southwest, et al) is: MC=AC=Scomp=60. In the previous scenario Delta’s market share was 20% since all five firms were identical.  What is Delta’s new market share?

Microeconomic Theory
12th Edition
ISBN:9781337517942
Author:NICHOLSON
Publisher:NICHOLSON
Chapter15: Imperfect Competition
Section: Chapter Questions
Problem 15.5P
icon
Related questions
Question

consider Atlanta as an oligopoly market with five airlines that behave in a Cournot Model fashion.  The Atlanta market demand schedule is:
P = 400 - .5*Q.
The Cost schedule for Delta is:
MC=AC=Scomp=100.
The Cost schedule for the other four firms (United, Southwest, et al) is:
MC=AC=Scomp=60.
In the previous scenario Delta’s market share was 20% since all five firms were identical.  What is Delta’s new market share?

Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps with 1 images

Blurred answer
Knowledge Booster
Payoff Matrix
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.
Recommended textbooks for you
Microeconomic Theory
Microeconomic Theory
Economics
ISBN:
9781337517942
Author:
NICHOLSON
Publisher:
Cengage
Managerial Economics: A Problem Solving Approach
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Economics (MindTap Course List)
Economics (MindTap Course List)
Economics
ISBN:
9781337617383
Author:
Roger A. Arnold
Publisher:
Cengage Learning
Microeconomics
Microeconomics
Economics
ISBN:
9781337617406
Author:
Roger A. Arnold
Publisher:
Cengage Learning
Economics For Today
Economics For Today
Economics
ISBN:
9781337613040
Author:
Tucker
Publisher:
Cengage Learning
Micro Economics For Today
Micro Economics For Today
Economics
ISBN:
9781337613064
Author:
Tucker, Irvin B.
Publisher:
Cengage,