Question 2 Only two firms, ABC and MNO, sell a particular product. The following table shows the demand curve for their product. Each firm has the same constant marginal cost of $4 and zero fixed cost. Quantity Demanded (Units) 0 Price (Dollars per unit) 14 13 12 11 10 9 8 7 6 5 4 3 2 1 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 Total Revenue (Dollars) 0 65 120 165 200 225 240 245 240 225 200 165 120 65 0 Total Cost (Dollars) Profit (Dollars) Refer to the table above and explain: A). If ABC and MNO operate to jointly maximize profits, then what is the price? B). If ABC and MNO operate to jointly maximize profits, then what quantity is sold?, C). If ABC and MNO operate to jointly maximize profits and agree to share the profit equally, then how much profit will each of them earn?

Question 2 Only two firms, ABC and MNO, sell a particular product. The following table shows the demand curve for their product. Each firm has the same constant marginal cost of $4 and zero fixed cost. Quantity Demanded (Units) 0 Price (Dollars per unit) 14 13 12 11 10 9 8 7 6 5 4 3 2 1 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 Total Revenue (Dollars) 0 65 120 165 200 225 240 245 240 225 200 165 120 65 0 Total Cost (Dollars) Profit (Dollars) Refer to the table above and explain: A). If ABC and MNO operate to jointly maximize profits, then what is the price? B). If ABC and MNO operate to jointly maximize profits, then what quantity is sold?, C). If ABC and MNO operate to jointly maximize profits and agree to share the profit equally, then how much profit will each of them earn?

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter14: Monopoly

Section: Chapter Questions

Problem 1PA

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