practicefinalMC-1

# A4unitsprofitsof6 b2unitsprofitsof2 c4unitslossesof2

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Unformatted text preview: . C. MR1(Q1,Q2) = 100 ‐ 2Q1 ‐ 4Q2 and MR2(Q1,Q2) = 100 ‐ 4Q1 ‐ 2Q2. D. MR1(Q1,Q2) = 24.5 ‐ 0.5Q2 and MR2(Q1,Q2) = 24.5 ‐ 0.5Q1. 13. Consider a Stackelberg duopoly with the following inverse demand function: P = 100 ‐ 2Q1 ‐ 2Q2. The firms' marginal cost are identical and given by MCi(Qi) = 2Qi. Based on this information the consumer surplus in this market is A. \$36.75. B. \$73.50. C. \$1,352.40. D. \$2,704.80. 14. Consider two firms competing to sell a homogeneous product by setting price. The inverse demand curve is given by P = 6 ‐ Q. If each firms' cost function is Ci(Qi) = 6 + 2Qi, then each firm will symmetrically produce _________ units of output and earn ___________. A. 4 units; profits of \$6. B. 2 units; profits of \$2. C. 4 units; losses of \$2. D. 2 units; losses of \$6. Answer question based on the following payoff matrix: 3 15. Which of the following is true? A. A dominant strategy for Firm A is "high price". B. There does not exist a dominant strategy for Firm A. C. A dominan...
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## This note was uploaded on 12/10/2012 for the course ECON 5501 taught by Professor Wing during the Fall '12 term at City University of Hong Kong.

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