Question: Demand for a product is given by , P ( Qd ) = 2 1 5 0 0 Qd . The product is supplied by
Demand for a product is given by PQd Qd The product is supplied by two firms that produce identical products, each of which has MC and no fixed costs. Each firm maximizes profit assuming that the others output will not change Cournot behaviora Derive each firms bestresponse function bestresponse functionb Calculate the CournotNash equilibrium price, quantity, and profit of each firm. c If the two firms operated as one and maximized joint profits what would be the price, quantities, and profits?
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