In a market with a duopoly, if market demand is find the Cournot Reaction curves and the Cournot quantity solutions then deduce the price in the case where Marginal cost curves for either of the duopoly firms is and . Compare your results to the case where a Monopolist that has a replaces the duopoly. What are the monopoly quantity and price? Which quantities are bigger, Cournot or Monopoly? What is the consumer Surplus in both cases? Set up the oligopoly model in a game-theoretical prisoner's dilemma framework. Explain briefly the strategies and how you reach the Nash Equilibrium.
In a market with a duopoly, if market demand is find the Cournot Reaction curves and...
Question 5 Demand in a market dominated by two firms (a Cournot duopoly) is determined according to: P = 200 – 2(Q1 + Q2), where P is the market price, Q1 is the quantity demanded by Firm 1, and Q2 is the quantity demanded by Firm 2. The marginal cost and average cost for each firm is constant; AC=MC = $60. The cournot-duopoly equilibrium profit for each firm is _____. Hint: Write your answer to two decimal places. QUESTION 6...
Demand in a market dominated by two firms (a Cournot duopoly) is determined according to: P = 300 – 4(Q1 + Q2), where P is the market price, Q1 is the quantity demanded by Firm 1, and Q2 is the quantity demanded by Firm 2. The marginal cost and average cost for each firm is constant; AC=MC = $74. The cournot-duopoly equilibrium profit for each firm is
Problem 2. Gibbons 1.5 Consider the following two finite versions of the Cournot duopoly model. First, suppose each firm must choose either half the monopoly quantity, 4m/2 = (a - c)/4, or the Cournot equilibrium quantity, 4c = (a - c)/3. No other quantities are feasible. Show that this two-action game is equivalent to the Prisoner's Dilemma: each firm has a strictly dominated strategy, and both are worse off in equilibrium than they would be if they cooperated. Second, suppose...
Demand in a market dominated by two firms (a Cournot duopoly) is determined according to: P = 200 – 2(Q1 + Q2), where P is the market price, Q1 is the quantity demanded by Firm 1, and Q2 is the quantity demanded by Firm 2. The marginal cost and average cost for each firm is constant; AC=MC = $75. The cournot-duopoly equilibrium quantity produced by each firm is _____. Hint: Write your answer to two decimal places.
3. Demand in a market dominated by two firms (a Cournot duopoly) is determined according to: P = 300 – 4(Q1 + Q2), where P is the market price, Q1 is the quantity demanded by Firm 1, and Q2 is the quantity demanded by Firm 2. The marginal cost and average cost for each firm is constant; AC=MC = $73. The cournot-duopoly equilibrium quantity produced by each firm is _____. Hint: Write your answer to two decimal places.
A duopoly faces a market demand of p 180-Q. Firm 1 has a constant marginal cost of Mc1 -S20. Firm 2s constant marginal cost is MC2 $40. Calculate the output of each firm, market output, and price if there is (a) a collusive equilibrium or (b) a Cournot equilibrium The collusive equilibrium occurs where q, equals and q2 equals (Enter numeric responses using real numbers rounded to two decimal places) Market output is The collusive equilibrium price is S The...
(16 points) Cournot Duopoly. Market demand is p(Q) = 50 – 4Q, where Q = 4+ 42. Firm 1's cost function is C (91) = 0, and firm 2 has a cost function C2(92) = 1092- The two firms engage in Cournot competition; they simultaneously choose a quantity and the price adjusts so that the market clears. (a) Formally write firm 1's profit maximization problem (b) Find firm l's best response function. (c) Take as given that firm 2's best...
2. (Cournot Model) Consider a Cournot duopoly. The market demand is p=160 - q2. Firm 1's marginal cost is 10, and firm 2's marginal cost is also 10. There are no fixed costs. A. Derive each firm's best response function B. What is the Nash equilibrium of this model? Find the equilibrium market price. C. Find the equilibrium profit for each firm D. Find the equilibrium consumer surplus in this market. 3. (Bertrand Model) Consider a Bertrand duopoly. The market...
What is the homogeneous-good duopoly Cournot equilibrium if the market demand function is Q=4,000-400p, and each firm's marginal cost is $0.28 per unit? The Cournot-Nash equilibrium occurs where q 1 equals ____and q 2 equals nothing. (Enter numeric responses using real numbers rounded to two decimal places.)
QUESTION 11 7. Oligopoly Theory. Consider a market with demand P-150-Q and MC - 30), and two sellers, and s2 Coumot Duopoly. Identify the equilibrium price, quantity and profits for each seller if the sellers interact as Cournot competitors. (10 points)