1. Assume that two companies (C and D) are duopolists that produce identical produces. Demand for the products is given by the following linear demand function: P=600-Qc-Qd where Qc and Qd are the quantities sold by the respective firms and P is the selling price. Total cost functions for the two companies are TCc=25000+100Qc;TCd=20000+125Qd;Assume that the firms act independently as in the Cournot model (i.e., each firm assumes that the other firm's output will not change).;a. Determine the long run equilibrium output and selling price for each firm.
Paper#29522 | Written in 18-Jul-2015Price : $22