A lemon-growing cartel consists of four orchards. Their total cost functions are: TC1 = 20 + 5Q1^2
TC2 = 25 + 3Q2^2
TC3 = 15 + 4Q3^2
TC4 = 20 + 6Q4^2 TC
is in hundreds of dollars, and Q is in cartons per month picked and shipped.
a. Tabulate total, average, and marginal costs for each firm for output levels between 1 and 5 cartons per month (i. e., for 1, 2, 3, 4, and 5 cartons).
b. If the cartel decided to ship 10 cartons per month and set a price of $25 per carton, how should output be allocated among the firms?
c. At this shipping level, which firm has the most incentive to cheat? Does any firm not have an incentive to cheat