Suppose duopolists face the market inverse demand curve P = 100 - Q, Q = q1 + q2, and both firms have a constant marginal cost of 10. If firm 1 is a Stackelberg leader and firm 2's best response function is q2 = (100 - q1)/2, at the Nash-Stackelberg equilibrium firm 2's output is
A) 30.
B) 40.
C) 60.
D) 70.
A
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The idea that investment in comprehensive education in developing countries leads to permanent increases in the rate of technological progress is an example of
A) a trade-off between human capital and technology. B) increasing economic inequality. C) capital deepening. D) new growth theory.
If the MPC = 1, the spending multiplier is:
a. infinite. b. zero. c. 10. d. 100. e. 1.
In designing a tax system, policymakers have two objectives that are often conflicting. They are
a. maximizing revenue and minimizing costs to taxpayers. b. efficiency and minimizing costs to taxpayers. c. efficiency and equity. d. maximizing revenue and reducing the national debt.
Which of the following gave the U.S. federal government the power to tax income?
A. The Full Employment and Balanced Growth Act of 1978. B. The capital gains tax of the Bush administration. C. The Sixteenth Amendment to the Constitution. D. The Social Security Act.