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Business, 05.05.2020 04:02 mandy294

2. (40 points) Suppose there are two firms in a market who each simultaneously choose a quantity. Firm 1’s quantity is q1, and firm 2’s quantity is q2. Therefore the market quantity is Q = q1 + q2. The market demand curve is given by P = 100 – 4Q. Also, each firm has constant marginal cost equal to 28. There are no fixed costs. The marginal revenue of the two firms are given by:MR1 = 100 – 8q1 – 4q2MR2 = 100 – 4q1 – 8q2.A) (8 points) How much output will each firm produce in the Cournot equilibrium?

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2. (40 points) Suppose there are two firms in a market who each simultaneously choose a quantity. Fi...
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