An industry has two firms each of which produces output at a constant unit cost of...
An industry has two firms each of which produces output at a constant unit cost of $10 per unit. The demand function for the industry is q = 1/p. The Cournot equilibrium price for this industry is
Group of answer choices
$10.
$15.
$5.
$25.
$20.
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An industry has two firms each of which produces output at a
constant unit cost of...
Assume that there are two firms in an industry, each producing with a constant marginal cost...
Assume that there are two firms in an industry, each producing with a constant marginal cost function of MC = 10. Assume that the demand function for the product is defined as follows: Q = 200 – 2P. a) Derive the best reaction functions for both firms. (5 marks) b) Determine the cournot equilibrium quantities and cournot equilibrium price. (5 marks)
For a constant cost industry in which all firms the same cost functions, their long-run average...
For a constant cost industry in which all firms the same cost functions, their long-run average cost is minimized at $10 per unit output and 20 units (i.e. q = 20). Market demand is given by QD=DP=1,500-50P. Find the long-run market supply function Find the long-run equilibrium price (P*), market quantity (Q*), firm output (q*), number of firms (n), and each firm’s profit. The short-run total cost function associated with each firm’s long-run costs is SCq=0.5q2-10q+200. Calculate the short-run average...
16. An industry has two firms. The cost function of Firm 1 is ci(q) 2q + 500, and the cost function of Firm 2 is...
16. An industry has two firms. The cost function of Firm 1 is ci(q) 2q + 500, and the cost function of Firm 2 is cz(g) - 2q + 400. The demand function for the output of this industry is a downward-sloping straight line. In a Cournot equilibrium in which both firms produce positive amounts of output: a. Total output of both firms is less than the cartel (joint-profit maximizing) output b. Firm 1 and Firm 2 produce the same...
= Consider an industry consisting of two firms which produce a homogeneous commodity. The industry demand...
= Consider an industry consisting of two firms which produce a homogeneous commodity. The industry demand function is Q = 100 – P, where Q is the quantity demanded and P is its price. The total cost functions are given as C1 = 50q1 for firm 1, and C2 = 60qz for firm 2, where Q 91 +92. a. (6 points) Suppose both firms are Cournot duopolists. Find and graph each firm's reaction function. What would be the equilibrium price,...
An industry has two firms producing at a constant unit cost of £10 per unit. The...
An industry has two firms producing at a constant unit cost of £10 per unit. The inverse demand curve for the industry is p = 110 -0.57. Suppose that firm 1 is a Stackelberg leader in choosing its quantity (i.e., firm 1 chooses its quantity first, knowing that firm 2 will observe firm 1's quantity when it chooses its own output.) How much output will firm 2, the follower, produce? a. 40 units. b. 15 units. c. 20 units. d....
ECON M/C Q An industry has two firms. The demand curve for the industry's output is...
ECON M/C Q
An industry has two firms. The demand curve for the industry's output is given by p= 36 - 3q, where q is the total industry output. Each firm has a constant marginal cost equal to 6. Suppose that firms compete in Cournot style (quantity competition). Which of the following statements is correct? Select one: a. Firm 1's reaction function is q1 = 9 -0.592. b. Firm 1's reaction function is qı = 9 - 92. C. Firm...
1.Consider an industry with only two firms that produce identical products. Each of the firms only...
1.Consider an industry with only two firms that produce identical products. Each of the firms only incurs a fixed cost of $1000 to produce and marginal cost is 20. The market demand function is as follows: Q=q1+q2=400-P a. Assuming that the firms form a cartel, calculate the profit-maximizing quantity of output, price and profits b. If the firms choose to behave as in the Cournot model, what would be the profit- maximizing quantities of output, price and profits? c. if...
Cournot Oligopoly and Number of Firms In a Cournot oligopoly, each firm assumes that its rivals...
Cournot Oligopoly and Number of Firms In a Cournot oligopoly, each firm assumes that its rivals do not change their output based on the output that it produces. Ilustration: A Cournot oligopoly has two firms, YandZ. Yobservesthe market demand curve and the number of units that Z produces. It assumes that Z does notchange its output regardless of the number of units that it (Y) produces, so chooses a production level that maximizes its profits. The general effects of a...
3) Suppose that an industry consists of two firms that produces a homogeneous product. Suppose that...
3) Suppose that an industry consists of two firms that produces a homogeneous product. Suppose that each firm decides how much to produce and assumes that its rival will not alter its level of production in response (Cournot Model). The industry demand equation is: P 145 5(Q1+ Q2) where Qland Q2 represents the output of Firm 1 and Firm 2, respectively. The total cost equations of the two firms are: TCF 3Q1 and TCF 5Q2 A, Calculate each firm's Best...
Please be descriptive. The market demand curve in a commodity chemical industry is given by Q...
Please be descriptive.
The market demand curve in a commodity chemical industry is given by Q 600 - 3P, where Q is the quantity demanded per month and P is the market price in dollars. Firms in this industry supply quantities every month, and the resulting market price occurs at the point at which the quantity demanded equals the total quantity supplied. Suppose there are two firms in this industry, Firm 1 and Firm 2. Each firm has an identical...
16. An industry has two firms. The cost function of Firm 1 is ci(q) 2q + 500, and the cost function of Firm 2 is cz(g) - 2q + 400. The demand function for the output of this industry is a downward-sloping straight line. In a Cournot equilibrium in which both firms produce positive amounts of output: a. Total output of both firms is less than the cartel (joint-profit maximizing) output b. Firm 1 and Firm 2 produce the same...
= Consider an industry consisting of two firms which produce a homogeneous commodity. The industry demand function is Q = 100 – P, where Q is the quantity demanded and P is its price. The total cost functions are given as C1 = 50q1 for firm 1, and C2 = 60qz for firm 2, where Q 91 +92. a. (6 points) Suppose both firms are Cournot duopolists. Find and graph each firm's reaction function. What would be the equilibrium price,...
An industry has two firms producing at a constant unit cost of £10 per unit. The inverse demand curve for the industry is p = 110 -0.57. Suppose that firm 1 is a Stackelberg leader in choosing its quantity (i.e., firm 1 chooses its quantity first, knowing that firm 2 will observe firm 1's quantity when it chooses its own output.) How much output will firm 2, the follower, produce? a. 40 units. b. 15 units. c. 20 units. d....
ECON M/C Q
An industry has two firms. The demand curve for the industry's output is given by p= 36 - 3q, where q is the total industry output. Each firm has a constant marginal cost equal to 6. Suppose that firms compete in Cournot style (quantity competition). Which of the following statements is correct? Select one: a. Firm 1's reaction function is q1 = 9 -0.592. b. Firm 1's reaction function is qı = 9 - 92. C. Firm...
Cournot Oligopoly and Number of Firms In a Cournot oligopoly, each firm assumes that its rivals do not change their output based on the output that it produces. Ilustration: A Cournot oligopoly has two firms, YandZ. Yobservesthe market demand curve and the number of units that Z produces. It assumes that Z does notchange its output regardless of the number of units that it (Y) produces, so chooses a production level that maximizes its profits. The general effects of a...
3) Suppose that an industry consists of two firms that produces a homogeneous product. Suppose that each firm decides how much to produce and assumes that its rival will not alter its level of production in response (Cournot Model). The industry demand equation is: P 145 5(Q1+ Q2) where Qland Q2 represents the output of Firm 1 and Firm 2, respectively. The total cost equations of the two firms are: TCF 3Q1 and TCF 5Q2 A, Calculate each firm's Best...
Please be descriptive.
The market demand curve in a commodity chemical industry is given by Q 600 - 3P, where Q is the quantity demanded per month and P is the market price in dollars. Firms in this industry supply quantities every month, and the resulting market price occurs at the point at which the quantity demanded equals the total quantity supplied. Suppose there are two firms in this industry, Firm 1 and Firm 2. Each firm has an identical...
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