Question

Because of their unique expertise with explosives, the Zambino brothers have long enjoyed a monopoly of the European market for public fireworks displays for crowds above a quarter of a million. The annual demand for these fireworks displays is P = 102 - 1Q. The marginal cost of putting on a fireworks display is 24. A family dispute broke the firm in two. Alfredo Zambino now runs one firm and Luigi Zambino runs the other. They still have the same marginal costs, but now they are Cournot duopolists. How much profit has the family lost? (Round your answer to 2 decimal places (e.g., 32.16). Negative answer should be indicated by a minus sign.)

Answer 1

Paga No: P=102-d MC =24 TR=1020-0² MR=0TR 102-20 Pofit is max when MR-MC 102-20=24 d =10224 78 39 & Penci=102.39 profit = (63-24) 39 = 1521 Under Cournot Ti = 1020,- Oy - O₂ - 240 atil -102.20,- ₂ - 2450 201 101=78-02 17 4802 = 28-0) Op 4 a 01 =78-[78-017 o - 166 78 +0 Oir 28 260 0,702=26 frui = 102-52=50 T, = T₂ = (50-24) 26= total T = 1352 2 کرام کا = ا ا or - po 119 Profit reduces by $169