the mobile phone market, Samsung and Apple constitute a duopoly in the production of devices. The American firm has the following demand q_a = 10 - p_a + 0.25p_s, and the Korean firm, q_s = 20 - p_s+ 0.5p_a. Because both firms assembly their devices in China, their cost structure is the same and equal to ?(q) = 10q, answer the following questions. a) What would be the equilibrium (quantity, price, and profit)
the mobile phone market, Samsung and Apple constitute a duopoly in the production of devices. The American firm has the following demand q_a = 10 - p_a + 0.25p_s, and the Korean firm, q_s = 20 - p_s+ 0.5p_a. Because both firms assembly their devices in China, their cost structure is the same and equal to ?(q) = 10q, answer the following questions. a) What would be the equilibrium (quantity, price, and profit)
Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Chapter12: Price And Output Determination: Oligopoly
Section: Chapter Questions
Problem 2E
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Question
In the mobile phone market, Samsung and Apple constitute a duopoly in the production of devices.
The American firm has the following demand q_a = 10 - p_a + 0.25p_s, and the Korean firm, q_s = 20 -
p_s+ 0.5p_a. Because both firms assembly their devices in China, their cost structure is the same and
equal to ?(q) = 10q, answer the following questions.
a) What would be the
answer.
b) If they decide to form a cartel, what are the new quantities, prices, and profits?
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