Assume there are two firms in a market producing the same homogeneous good, whose demand is given by P=600-2Q.Both firms have constant marginal cost functions, with marginal costs of c1 =10 and c2 =20, for firm 1 and firm 2, respectively.

a)Assume that firms compete by choosing prices simultaneously. What is the price consumers’ pay in the market, and what is each firm's profit (assume that the smallest price difference is one paisa)?

b)What if instead of price, firms compete by choosing quantity

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a Ass ume that firms compete by choosing prices simultaneously What is the price consumers pay in th... View the full answer