onsider a Cournot duopoly with the following inverse demand function: P = 400 − 3Q1 − 3Q2 . The firms' marginal costs are identical and are given by MCi(Qi) = 2Qi. Based on this information, firm 1 and 2's marginal revenue functions are Multiple Choice MR1(Q1,Q2) = 400 − 6Q1 − 3Q2 and MR2(Q1,Q2) = 400 − 3Q1 − 6Q2. MR1(Q1,Q2) = 200 − 6Q2 and MR2(Q1,Q2) = 200 − 3Q1. MR1(Q1,Q2) = 200 − 3Q1 − 3Q2 and MR2(Q1,Q2) = 200 − Q1 − 3Q2. MR1(Q1,Q2) = 400 − 6Q1 − 6Q2 and MR2(Q1,Q2) = 400 − 6Q1 − 6Q2.

Consider a COURNOT duopoly. Market demand is P(Q)=140-Q and each firm faces a constant marginal cost of $20. If Firm 1 produces 29 units and firm 2 produces 30 units, what is Firm 2's Producer Surplus? Enter a number only, drop the $ sign.

Consider the following 2-firm (firm 1 and 2) model of Bertrand duopoly with differen- tiated products. Demand for firm i is q:(Pi, P;) = a – Pi – bi.Pj costs are zero for both firms. The sensitivity of firm i's demand to firm j's price is measured by bị. (a) First suppose b1 # b2. Find the equilibrium prices p1 and p2. (b) Deduce that if the two firms are identical, they choose the same price p = 216) where b = b1 = b2. а

A duopoly faces an inverse market demand of P(Q) = 240−Q.Firm 1 has a constant marginal cost of MC1 (q1) = ​$10.Firm​ 2's constant marginal cost is MC2 (q2) =​ $20.Assume fixed costs are negligible for both firms. Calculate the output of each​ firm, market​ output, and price if there is​ (A) a collusive equilibrium or​ (B) a Cournot equilibrium.   ​(A) Collusive equilibrium ​(Enter your responses rounded to two decimal​ places)   The collusive equilibrium occurs where q1  equals ?and q2 equals ?   Market output is ?   The collusive equilibrium price is ?     ​(B) Cournot equilibrium ​(Enter your responses using rounded to two decimal​ places)   The​ Nash-Cournot equilibrium occurs where q1 equals ? and q2  equals ?   Market output is ?   The equilibrium occurs at a price of ?

Answer questions a, b, c

Consider a duopoly in which two identical firms compete by setting their quantities but Firm 1 has first mover advantage​ (i.e., Firm 1 is the Stackelberg​ Leader). We want to consider whether Firm 1 should use its advantage to drive Firm 2 out of the market.

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The (inverse) market demand function in a homogeneous product Cournot duopoly is as follows: P = 200- 10(Q1+Q2). The total cost functions are TC- 100 + 40Q1 for firm one and TC = 80 + 60Q2 for firm two. 1. Determine the reaction function for each firm. 2. Calculate each firm's equilibrium level of output. 3. Calculate the market equilibrium price. 4. Calculate the profit each firm earns in equilibrium.

4. Consider a Cournot Oligopoly with two firms, where firm 1 is twice as efficient as firm 2. In particular, firm l's cost function is c1(q1) = q1, while firm 2's cost function is e2(q2) = 2q2. The inverse market demand function is given by P = 100 – 5(q1 +92). (a) Find the firms' reaction (best response) functions. (b) Find the firms' equilibrium output levels and their profits. Does firm 1 make twice the profit of firm 2?

ii) Consider two firms producing differentiated products and competing on price choice. Their demand functions are given below 9, = 100 – 4p, + P2 TC = 20q, TC, = 20q, Their total costs are given as; 9, = 100 – 4p, + P, Determine the collusion equilibrium (price, quantity and profit) ( .