Consider a Stackelberg duopoly with the following inverse demand function: P = 100 ? 2Q1 ? 2Q2. The firms' marginal costs are identical and are given by MCi(Qi) = 2. Based on this information, the follower's reaction function is:
A. rF(QL) = 24.5 ? 0.5QF.
B. QF = 49 ? 0.25QL.
C. QL = 49 ? 0.5QF.
D. rF(QL) = 24.5 ? 0.5QL.
Answer: D
You might also like to view...
Currently you purchase 6 packages of hot dogs a month. You will graduate from college in December and you will start a new job in January. You have no plans to purchase hot dogs in January. For you, hot dogs are
a. a substitute good.
b. a normal good.
c. an inferior good.
d. a law-of-demand good.
The primary conclusion of using inflation accounting is that inflation
A. distorts the tax system and results in slower economic growth. B. reduces the national debt to its nominal value instead of its real value. C. causes recessions and increases the structural deficit. D. distorts government budget accounting by exaggerating interest expense.
Which of the following is the treaty that took the participating countries from a free trade area to a common market?
A) The Treaty of Rome B) The Maastricht Treaty C) The Single European Act D) The Treaty on European Union
The demand for money to cover unexpected expenditures and to meet emergencies is known as
A. the terminal demand for money. B. the asset demand for money. C. the precautionary demand for money. D. the transactions demand for money.