9 A duopoly faces a market demand of p= 120-Q. Firm 1 has a constant marginal cost of MC¹ = $10. Firm 2's constant marginal cost is MC² = $20. Calculate theoutput of each firm, market output, and price if there is (a) a collusive equilibrium or (b) a Cournot equilibrium.The collusive equilibrium occurs where q, equals and q2 equals 0. (Enter numeric responses using real numbers rounded to two decimal places)Solve for:Collusive Q1, Q2, market output, andcollusive equilibrium price.Cournot-Nash equilibrium Q1,Q2, price andmarket output.

Collusion is a non-cutthroat, secret, and some of the time unlawful understanding between rivals…

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olve for: Collusive Q1, Q2, market output, and ollusive equilibrium price.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter15: Imperfect Competition

Section: Chapter Questions

Problem 15.4P

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Question

A duopoly faces a market demand of p= 120-Q. Firm 1 has a constant marginal cost of MC¹ = $10. Firm 2's constant marginal cost is MC² = $20. Calculate the
output of each firm, market output, and price if there is (a) a collusive equilibrium or (b) a Cournot equilibrium.
The collusive equilibrium occurs where q, equals and q2 equals 0. (Enter numeric responses using real numbers rounded to two decimal places)
Solve for:
Collusive Q1, Q2, market output, and
collusive equilibrium price.
Cournot-Nash equilibrium Q1,Q2, price and
market output.

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