Answered: Suppose we have 2 firms competing on…

Suppose we have 2 firms competing on quantity in a homogenous-goods market. The market inverse demand function is P=17-0.5Q, and each firm has cost function TC; = 5 +8q; + ³/q?, for i=1,2.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

In the Cournot equilibirum, what is the market price and units produced by firm 1 and firm 2?

Suppose we have 2 firms competing on quantity in a homogenous-goods market. The market inverse
demand function is P=17-0.5Q, and each firm has cost function TC; = 5 +8qi+q, for i=1,2.
3 2

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