The firms in a duopoly produce differentiated products. The inverse demand for Firm 1 is P1 = 112 - 91 - 0.5q2. The inverse demand for Firm 2 is P2 = 130 – 92 - 0.5q1. Each firm has a marginal cost of m = $1 per unit. Solve for the Nash-Cournot equilibrium quantities. The Cournot equilibrium quantities are 91 units and 92 =Lunits. %D (Enter your responses rounded to two decimal places.)

The firms in a duopoly produce differentiated products. The inverse demand for Firm 1 is P1 = 112 - 91 - 0.5q2. The inverse demand for Firm 2 is P2 = 130 – 92 - 0.5q1. Each firm has a marginal cost of m = $1 per unit. Solve for the Nash-Cournot equilibrium quantities. The Cournot equilibrium quantities are 91 units and 92 =Lunits. %D (Enter your responses rounded to two decimal places.)

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter15: Imperfect Competition

Section: Chapter Questions

Problem 15.5P

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