Consider a Duopoly model, in which two firms decide a quantity sequentially. For the convenience, let's say Firm 1 is a dominant firm and Firm 2 is a follower. The market demand is given by P=110 - 5Q, where Q is the total output (i.e., Q=Q1+Q2). Each firm has an identical cost function, TCi=7Qi, i=1, 2. Each firm maximizes its profit by choosing the quantity. In this Stackelberg equilibrium, Firm 1 will sell how many units.

Consider a Cournot duopoly. The market demand function is P = 180 – 2(q₂ + q₂), where P is the market price, q₂ is the output produced by Firm 1 and q₂ is the output produced by Firm 2. The two firms have a constant marginal cost c = 30. What is the total output in this market? Round your answer to the nearest integer (e.g. 50)

Consider a market that is a Bertrand oligopoly with 5 firms in the market.  Each of these firms produce an identical product and each have the same cost function of C(Q) = 80Q.  The inverse market demand for this product is P = 2480 – 2Q. What is the equilibrium market price?

**Practice** Consider a market with three firms. Each firm has a different cost function. We assume C1(q1) = 7q1, C2(q2) = q2 + 1, and C3(q3) = 3q3.

Consider a Duopoly model, in which two firms decide a quantity sequentially. For the convenience, let's say Firm 1 is a dominant firm and Firm 2 is a follower. The market demand is given by P=110 - 5Q, where Q is the total output (i.e., Q=Q1+Q2). Each firm has an identical cost function, TCi=7Qi, i=1, 2. Each firm maximizes its profit by choosing the quantity. In this Stackelberg equilibrium, Firm 1 will sell __________  units.

onsider a homogenous good industry with four firms. Total demand is given by D(p)=200-p.The variable (=marginal) cost of each of the firms is c1=10, c2=20, c3=30 and c4=35. Firms compete in prices. Suppose firms 1 and 2 merge into one entity and produce with a marginal cost of 15.   Which of the following statements is correct?     After the merger, total welfare increases by $500.     After the merger, total welfare decreases by $500.     After the merger, total welfare increases by $1000.     After the merger, total welfare decreases by $1000.     None of the above.

Can you show me the answer of question c and d? Thank you so much for your help

Consider an industry that consists of 4 firms, all competing over the same market, given by the following demand equation: P=80-3Q All firms have the same Total Cost Function, given by: TC₁=10q,+2q Suppose the firms decide to collude and voluntarily restrict output and raise price, in order to increase profits. a) What price will be charged by the members of the cartel? Assume the head of the cartel is fair and distributes output q, equally among the 4 firms (since they have identical costs). b)What is the output of each individual firm?  c) What is each individual firm's profit? We know that there is a built-in incentive for cartel members to cheat on the cartel. If, as a result, the cartel breaks down: d) What price will be charged in the market?  e) Assuming each firm captures an equal share of the market, what now is each firm's output, q?  f) What now is individual firm profit? g) Illustrate your answer

Suppose two firms, Firm A and Firm B, are competing by setting quantities (Cournot competition). Firm A has a constant marginal cost of $10 per unit; Firm B has a constant marginal cost of $15 per unit. Assume fixed costs are equal to 0 for both firms. Hint: since fixed costs are zero and the marginal cost is constant, MC = AC. The two firms choose between producing 50 units or 100 units. If the total output is 100 units, the price is $20 per unit; if total output is 150 units, the price is $15 per unit; if total output is 200 units, the price is $10 per unit.  Based on the information provided, fill in the firms’ profits in the payoff matrix below with Firm A choosing the row and Firm B choosing the column.      QB=100   QB=50   QA=100   ,   , QA=50   ,   , The resulting equilibrium is for Firm A to produce ____ (50 or 100)units and Firm B to produce_____ (50 or 100) units.

Consider the Bertrand model and answer the question below related to the content. Assume that each firm in the Bertrand Duopoly model can only choose non-negative integer quantities: 0, 1, 2, ... . Assume the demand is Q(P)=10-P and the marginal cost is 0 for each firm. Given this information, which of the following is FALSE? [Hint: Check values of profit functions.]   A. If firm 2 sets price equal to 1, then the best response of firm 1 to this price is 1   B. If firm 2 sets price equal to 4, then the best response of firm 1 to this price is 4   C. If firm 2 sets price equal to 2, then the best response of firm 1 to this price is 1