Assuming zero marginal and zero fixed costs what are the, Ask an Expert

Economics

Consider the market Where there is product differentiation with two firms. The firms are choosing prices p1and p2 and have demands given by

q1 = 40 - 0.5p1 + p2, q2 = 60 - 2p2 + p1.

Assuming zero marginal and Zero fixed costs, what are the firms' best response function, that is best price of firm1 given price of firm2, and best price of firm2 given price of firm1.

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Microeconomics, Economics

Category:- Microeconomics
Reference No.:- M959488

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