Smalltown has 140 residents and two mobile phone providers: Verizon and AT&T Each firm's costs: FC = $0, MC = $10. Assume the two firms collude, how much profit does each make if they share it equally? P Q TR TC Profit 45 50 40 60 35 70 30 80 25 90 20 100 15 110 10 120 5 130 0 140 Q = 30, P= $40, profits = $900 Q = 40, P= $30, profits = $800 Q = 60, P= $10, profits = $0 Q=25, P = $45, profits = $875

Smalltown has 140 residents and two mobile phone providers: Verizon and AT&T Each firm's costs: FC = $0, MC = $10. Assume the two firms collude, how much profit does each make if they share it equally? P Q TR TC Profit 45 50 40 60 35 70 30 80 25 90 20 100 15 110 10 120 5 130 0 140 Q = 30, P= $40, profits = $900 Q = 40, P= $30, profits = $800 Q = 60, P= $10, profits = $0 Q=25, P = $45, profits = $875

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter15: Oligopoly And Strategic Behavior

Section: Chapter Questions

Problem 11P

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