Question: Demand in a duopoly is given by p = 100 - Q. Both firms have marginal cost c. a. Find the Cournot equilibrium quantities, price

Demand in a duopoly is given by p = 100 - Q. Both firms have marginal cost c.

a. Find the Cournot equilibrium quantities, price and profits.

b. Suppose Firm 1's marginal cost decreases to c - d (while Firm 2's marginal cost is still c). Find the new Cournot equilibrium quantities, price and profits.

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