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QUESTION 9 A homogeneous products duopoly faces a market demand function given by P-a-Q, where Q Q1 + Q2 and a-300. Both firms have constant marginal costs MC-100. There are no fixed costs a) What is firm 1s optimal quantity given that firm 2 produces an output of 50 units per year? And what is frms 1 quantity if firm 2 produces 20 units? 4 marks) b) Derive the equation of each firms reaction function and provide a graphical explanation to comment your results 4 marks) c) What is the Cournot equilibrium quantity per firm and price in this market? (6 marks d) What would be the market equilibrium quantity and price if the two firms were 8 marks) perfectly competitive? Please comment results comparing them to the ones obtained in the Cournot equilibrium e) What are the Cournot equilibrium quantities and industry price if both firms marginal costs decrease to MC-90 [8 marks]

can someone help me with question 9?

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다 homeg en eous ,roducts duop DIY a market emand bunction is ⑨ What is tirm ls optimul quantity g en thut bi rm 2 produ ces an output so units aiver that Maket demand buncon s ai 1 .26 When Q2-20 Lo o 240- 6Q1 6 123.33 Derive th e equation each birmsreation bunction cV 22. Firm 2 reaction tuntHor 40 Firm iAs perSm hhat is the coun equilibium qJamti The ms choose the same Jevel Q2 to.s Q2- 23.33 l.SQ2 33.33 0233. 33 0222. 22 e equitibrium price an be tound b utin he quanHi into the market demand Hence 30 0 3044-44 P 16 6.67 Э htha would be the marke equilibrium quanH Ans. ar equili brium, p- MC

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