ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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Consider a noncollusive duopoly model with both firms supplying bottled drinking water. The marginal cost for each firm is
$1.50. The market demand is shown by the figure on the right.
Let us assume that the two firms supplying bottled drinking water are Firm A and Firm B. The price charged by Firm A is
denoted as PA and the price charged by Firm B is denoted as Pg
Find the demand functions for each of the firms.
If PA S$7, then demand for Firm A's bottled drinking water is:
thousand if PA PB
thousand if PA PB
thousand if PA PB
If PB $7, then demand for Firm B's bottled drinking water is:
thousand if PB PA
thousand if PB PA
thousand if PB>PA
(Round your responses to two decimal places.)
B
3-
2-
1-
0.5
Demand
1.5 2 25 3 3.5 4
Quantity (in thousands)
රරම
4.5
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Transcribed Image Text:Consider a noncollusive duopoly model with both firms supplying bottled drinking water. The marginal cost for each firm is $1.50. The market demand is shown by the figure on the right. Let us assume that the two firms supplying bottled drinking water are Firm A and Firm B. The price charged by Firm A is denoted as PA and the price charged by Firm B is denoted as Pg Find the demand functions for each of the firms. If PA S$7, then demand for Firm A's bottled drinking water is: thousand if PA PB thousand if PA PB thousand if PA PB If PB $7, then demand for Firm B's bottled drinking water is: thousand if PB PA thousand if PB PA thousand if PB>PA (Round your responses to two decimal places.) B 3- 2- 1- 0.5 Demand 1.5 2 25 3 3.5 4 Quantity (in thousands) රරම 4.5
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