Suppose that market demand for golf balls is described by Q = 90 - 3P, where Q is measured in kilos of balls. There are two firms that supply the market. Firm 1 can produce a kilo of balls at a constant unit cost equal to $10.
a) Suppose firms compete in quantities. How much does each firm sell in a Cournot equilibrium? What is the market price and what are firms' profits?