In a Cournot duopoly model, the market demand curve is given by P = 100 - yI -y where y, is the amount of output firm 1 produces and y2 is firm 2's level of output. The co- function of firm 1 is c(y1) 75 +8y1. The cost function of firm 2 is c(y2) = 100 +12y2. The reaction function of firm 1 is y1 = - 0.5y2. The reaction function of firm 2 is y2 -0.5y1- In the Cournot equilibrium, firm 2 produces units of output and makes a producer

In a Cournot duopoly model, the market demand curve is given by P = 100 - yI -y where y, is the amount of output firm 1 produces and y2 is firm 2's level of output. The co- function of firm 1 is c(y1) 75 +8y1. The cost function of firm 2 is c(y2) = 100 +12y2. The reaction function of firm 1 is y1 = - 0.5y2. The reaction function of firm 2 is y2 -0.5y1- In the Cournot equilibrium, firm 2 produces units of output and makes a producer

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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