1 consider a cournot duopoly with the inverse demand p 130, Ask an Expert

Economics

1. Consider a Cournot duopoly with the inverse demand p = 130 - Q. Both firms have constant marginal and average cost MC = AC = 10.

a-Find the Cournot-Nash equilibrium output and profit of each firm. Calculate the con-sumer surplus and DWL.

b-Suppose those two firms collude as a monopolist, find the equilibrium output and theirjoint profit. Calculate the consumer surplus and DWL under collusion.

c-Compare your results in (a) and (b).

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Business Economics, Economics

Category:- Business Economics
Reference No.:- M91299546

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