ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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There are two movie theaters in the town of Harkinsville: Modern Multiplex (Firm 1) and Galaxy (Firm 2). The demands for each firm are: Q1 = 125 – 3.5P1 + 2P2 and Q2 = 125 – 3.5P2 + 2P1, where quantities are measured in hundreds of moviegoers. Costs per customer are: $4 for Firm 1 and $3 for Firm 2.
Instructions: Use no decimals. Use the average cost to calculate
Complete the following table.
P1 |
P2 |
Q1 |
Q2 |
Profits F1 |
Profits F2 |
|
Firm 1 colludes, Firm 2 cheats w/ QDC |
|
|
|
|
|
2,824 |
Firm 1 colludes, Firm 2 cheats w/ QBRF |
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