Mike's company produces at the total cost level: TC = 200 Q, while market demand is...

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Mike's company produces at the total cost level: TC = 200 Q, while market demand is shown by the equation: Q = 100 -0.2 P. a. If the company is the only producer, determine the equilibrium price level and quantity that provides maximum profit, also determine the amount of profit or loss obtained. b. If another company enters the market; let's assume Q1 is the output of the first company and Q2 is the output of the second company so that market demand is now Q1 + Q2 = 100 -0.2 P. Assuming that each company has a cost equation TCI = 200 Qi where i = 1 and 2, and each company tries to obtain maximum profits, determine the output level of each company, also determine the prevailing price level and the amount of profit obtained by each each company. c. If the first company decides to announce the amount of output it will produce before competitors do, determine the output level of each company, also determine the prevailing price level and the amount of profit earned by each company. Mike's company produces at the total cost level: TC = 200 Q, while market demand is shown by the equation: Q = 100 -0.2 P. a. If the company is the only producer, determine the equilibrium price level and quantity that provides maximum profit, also determine the amount of profit or loss obtained. b. If another company enters the market; let's assume Q1 is the output of the first company and Q2 is the output of the second company so that market demand is now Q1 + Q2 = 100 -0.2 P. Assuming that each company has a cost equation TCI = 200 Qi where i = 1 and 2, and each company tries to obtain maximum profits, determine the output level of each company, also determine the prevailing price level and the amount of profit obtained by each each company. c. If the first company decides to announce the amount of output it will produce before competitors do, determine the output level of each company, also determine the prevailing price level and the amount of profit earned by each company.

Answer rating: 100% (QA)

a If the company is the only producer we can find the equilibrium price level and quantity by setting the quantity demanded equal to the quantity supplied ... View the full answer