Suppose Cournot duopolist firms operate with each having a cost of 30qi (i = 1,2 ) so that each firm's marginal cost is 30. The inverse market demand curve is P = 120 - Q where Q = q1 + q2
Suppose there were no barriers to entry and firms continued to enter so long as there were positive economic profits. At the Nash-Cournot equilibrium, the total output, Q, is A) 30.
B) 45.
C) 60.
D) 90.
D
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Comparative advantage means
A) the ability to produce more of a product with the same amount of resources than any other producer. B) the ability to produce a good or service at a lower opportunity cost than any other producer. C) the ability to produce a good or service at a higher opportunity cost than any other producer. D) compared to others you are better at producing a product.
Which of the following is consistent with farming as a competitive market?
A. Zero economic profit in the long run. B. Negative economic profit in the long run. C. A large percentage of costs are for advertising. D. Positive economic profit in the long run.
Despite the long-term mutual gains from international trade, in the short run
A. particular firms, industries, and groups of workers can be harmed substantially by imports. B. international trade is usually inflationary. C. countries must learn to be self-sufficient. D. most countries realize mutual net losses.
"A drop in the money supply lowered output in the short run, but left output unaffected in the long run." This statement implies that the price level __________ in the long run, causing the interest rate to __________
A) rose; rise B) rose; fall C) fell; rise D) fell; fall