2) Two firms, a and b, in a Cournot oligopoly face the inverse
demand function p...
2) Two firms, a and b, in a Cournot oligopoly face the inverse
demand function p = 500 – 2Q. Their cost function is c
(qi) = 20 + 4qi2 for i = a, b.
Calculate the profit maximizing price output combination. (3)
3) Two firms, a and b, in a Cournot oligopoly face the inverse
demand function p = 25 – Q. Their cost function is c
(qi) = 0.5*qi for i = a,
b. Calculate the profit maximizing price output
combination. (3)
Two firms operate in a Cournot duopoly and face an inverse
demand curve given by P = 200 - 2Q, where Q=Q1+Q2 If each firm has
a cost function given by C(Q) = 20Q, how much output will each firm
produce at the Cournot equilibrium?
a. Firm 1 produces 45, Firm 2 produces 45.
b. Firm 1 produces 30, Firm 2 produces 30
c. Firm 1 produces 45, Firm 2 produces 22.5
d. None of the above.
In a Cournot Oligopoly market with the demand function
p=220−0.5⋅Q there are 2 firms producing homogeneous product. The
total cost functions of the first and second firm are
TC1=15+4⋅q1TC1=15+4⋅q1 and TC2=20+5⋅q2TC2=20+5⋅q2, respectively.
Firms choose their output levels simultaneously. Calculate the
output level for firm 1 in equilibrium. Round you answer to the
first decimal place.
Consider a Cournot duopoly, the firms face an (inverse) demand
function: Pb = 128 - 3 Qb. The marginal cost for firm 1 is given by
mc1 = 4 Q. The marginal cost for firm 2 is given by mc2 = 6 Q.
(Assume firm 1 has a fixed cost of $ 65 and firm 2 has a fixed cost
of $ 87 .) How much profit will firm 2 earn in the duopoly
equilibrium ?
Two firms compete as a Stackellberg duopoly. The inverse
market demand function they face is P = 65 – 3Q. The cost function
for each firm is C(Q) = 11Q. The outputs of the two firms
are
Two firms compete as a Stackelberg duopoly. The inverse market
demand function they face is P = 65 – 3Q. The cost function for
each firm is C(Q) = 11Q. The outputs of the two firms are
QL = 9, QF = 4.5
QL = 9, QF = 10.5
QL = 6, QF = 3
QL = 4, QF = 2
Please help/ explain. Thank you
Firms A and B are Cournot duopolists producing a homogeneous
good. Inverse market demand is P = 100 − Q , where P is market
price and Q is the market quantity demanded. Each firm has marginal
and average cost c = 40.
(a) The two firms propose to merge. Derive total output, market
price, profit and consumer surplus before the merger and after the
merger. Explain intuitively any changes you see to these variables
when the merger occurs.
(b)...
Question #5: Consider a Cournot duopoly, the firms face an
(inverse) demand function: Pb = 110 - 7 Qb. The marginal cost for
firm 1 is given by mc1 = 5 Q. The marginal cost for firm 2 is given
by mc2 = 7 Q. (Assume firm 1 has a fixed cost of $ 112 and firm 2
has a fixed cost of $ 148 .) How much profit will firm 2 earn in
the duopoly equilibrium ?
Assume that two firms are in a Cournot oligopoly market. Market
demand is P=120 - Q where Q isthe aggregate output in the market
and P is the price. Firm 1 has the cost function
TC(Q1)=30 + 10Q1 and Firm 2 has the cost
function TC(Q2)=15 + 20Q2.
a) Write down the
Profit function of Firm 1:
Profit function of Firm 2:
b) Using the profit functions in part (a), obtain the reaction
function of Firm 1 to Firm 2....
Consider an oligopoly with 2 firms. The inverse demand curve is
given by P = 100 – Q1 – Q2. Firm 1’s total
cost function is TC1 = 30Q1. Firm 2’s total
cost function is TC2 = 20Q2. Assume now that
the firms compete by choosing their prices simultaneously, so it is
a Bertrand Oligopoly model. Assume that firms choose prices in 0.01
in intervals. (i.e. A firm can choose to charge $10.00 or $10.01,
but not $10.005).
a) Consider...