Quiz 27. Cournot - The cost of producing one unit is zero...

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Shomu Banerjee ECON 201 COURNOT DUOPOLY Suppose two duopolists produce the same identical product. The market demand for their product is given by the inverse demand curve p = 120 – q 1 q 2 , where p is the price, and q 1 and q 2 the output levels of the firms.
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Unformatted text preview: The cost of producing one unit is zero for firm 1 and 30 for firm 2. (a) How much will each firm produce in Nash equilibrium? (b) Calculate the equilibrium price p * and profits for each firm....
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This note was uploaded on 10/26/2010 for the course ECONOMICS ECON 201 taught by Professor Dr.shomubanerjee during the Summer '07 term at Emory.

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