6. Suppose that identical duopoly firms have constant marginal costs of $10 per unit.Firm 1 faces a demand function of q1 =100– 2p1+p2, where q1 is Firm l's output, pi is Firml's price, and p2 is Firm 2's price. Similarly, the demand Firm 2 faces is q2 = 100– 2p2+P1.Solve for the NE.

Under these presumptions, it very well may be shown that the Bertrand (Nash) equilibrium is that…

Firm 1 faces a demand function of q1 = 100– 2p1+p2, where q is Firm l's output, Pi is Firm %3D l's price, and p2 is Firm 2's price. Similarly, the demand Firm 2 faces is q2 = 100 – 2p2+P1. Solve for the NE.

Firm 1 faces a demand function of q1 = 100– 2p1+p2, where q is Firm l's output, Pi is Firm %3D l's price, and p2 is Firm 2's price. Similarly, the demand Firm 2 faces is q2 = 100 – 2p2+P1. Solve for the NE.

Survey of Economics (MindTap Course List)

9th Edition

ISBN:9781305260948

Author:Irvin B. Tucker

Publisher:Irvin B. Tucker

Chapter9: Monopolistic Competition And Oligoply

Section: Chapter Questions

Problem 19SQ

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Question 4 Consider a duopoly market with 2 firms. Aggregate demand in this market is given by Q = 500 – P, where P is the price on the market. Q is total market output, i.e., Q = QA + QB, where QA is the output by Firm A and QB is the output by Firm B. For both firms, marginal cost is given by MCi = 20, i=A,B. Assume the firms compete a la Cournot.Note that marginal revenue for both firms is given by MRA=500-2QA-QB, MRB=500-QA-2QB. Describe what a best-response curve is and how to find it. Derive the best-response function for each firm. What are the equilibrium quantities? What is the total quantity supplied on this market? What is the equilibrium price in this market?
Suppose that identical duopoly firms have constant marginal costs of $0 per unit. Firm 1 faces ademand function of q1 = 100 – 2p1 + p2, where q1 is Firm 1’s output, p1 is Firm 1’s price, and p2 isFirm 2’s price. Similarly, the demand Firm 2 faces is q2 = 100 – 2p2 + p1. Please solve for theBertrand equilibrium.
Consider a duopoly market with 2 firms. Aggregate demand in this market is given by Q = 500 – P, where P is the price on the market. Q is total market output, i.e., Q = QA + QB, where QA is the output by Firm A and QB is the output by Firm B. For both firms, marginal cost is given by MCi = 20, i=A,B. Assume the firms compete a la Cournot. Find the inverse demand in this market. Note that marginal revenue for both firms is given by MRA=500-2QA-QB, MRB=500-QA-2QB. Describe what a best-response curve is and how to find it. Derive the best-response function for each firm. What are the equilibrium quantities? What is the total quantity supplied on this market? What is the equilibrium price in this market?
Consider a duopoly market with 2 firms. Aggregate demand in this market is given by Q = 500 – P, where P is the price on the market. Q is total market output, i.e., Q = QA + QB, where QA is the output by Firm A and QB is the output by Firm B. For both firms, marginal cost is given by MCi = 20, i=A,B. Assume the firms compete a la Cournot. Find the inverse demand in this market. Note that marginal revenue for both firms is given by MRA=500-2QA-QB, MRB=500-QA-2QB. 2.Describe what a best-response curve is and how to find it. 3. Derive the best-response function for each firm. 4. What are the equilibrium quantities? 5. What is the total quantity supplied on this market? 6. What is the equilibrium price in this market?
Consider a duopoly market with 2 firms. Aggregate demand in this market is given byQ = 500 – P,where P is the price on the market. Q is total market output, i.e., Q = QA + QB, where QA is the output by Firm A and QB is the output by Firm B. For both firms, marginal cost is given by MCi = 20, i=A,B. Assume the firms compete a la Cournot. 1. Find the inverse demand in this market. Note that marginal revenue for both firms is given by MRA=500-2QA-QB, MRB=500-QA-2QB. Describe what a best-response curve is and how to find it. Derive the best-response function for each firm. What are the equilibrium quantities? What is the total quantity supplied on this market? What is the equilibrium price in this market?
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Consider a duopoly market with 2 firms. Aggregate demand in this market is given by Q = 500 – P, where P is the price on the market. Q is total market output, i.e., Q = QA + QB, where QA is the output by Firm A and QB is the output by Firm B. For both firms, marginal cost is given by MCi = 20, i=A,B. Assume the firms compete a la Cournot. a) Find the inverse demand in this market. Note that marginal revenue for both firms is given by MRA=500-2QA-QB, MRB=500-QA-2QB. b) Describe what a best-response curve is and how to find it. c) Derive the best-response function for each firm. d) What are the equilibrium quantities? e) What is the total quantity supplied on this market? f) What is the equilibrium price in this market? **if possible, please answer my questions in typing as its hard for me to read works in hand-written, thanks
Consider a duopoly market with 2 firms. Aggregate demand in this market is given by Q = 500 – P, where P is the price on the market. Q is total market output, i.e., Q = QA + QB, where QA is the output by Firm A and QB is the output by Firm B. For both firms, marginal cost is given by MCi = 20, i=A,B. Assume the firms compete a la Cournot. 1. What are the equilibrium quantities? 2. What is the total quantity supplied on this market? 3. What is the equilibrium price in this market?
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E1 Find Bertrand equilibrium and its outputs for the following asymmetric duopoly:q 1(p1, p2) = 16 - p1 + 0.5 p2, C1(q1) = 4q1;q 2(p1, p2) = 16 + 0.5 p1 - p2, C2(q2) = 6q2.(Note that the average and marginal costs are: AC1=MC1 = c1 = 4, AC2=MC2 = c2 = 6)
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