Question: Please help me with finding the answer for this question, all help is appreciated! Consider two rms supplying for the market for a homogenous good.

Please help me with finding the answer for this question, all help is appreciated!

Please help me with finding the answer for this question, all help

Consider two rms supplying for the market for a homogenous good. Let x and y be the output of each rm. Both rms have identical cost structure: xed cost is 4 and marginal cost is 4. The demand curve for the good is P = 100 Q, where P is the price and Q is the total supply of the market. Model these two rms as the Cournot duopolists with discrete time periods (t = O, 1, 2, ) so that each rm assumes the other rm's output of the previous period xed. a. Write down the prot of the rst rm for the period t+1 as a function of Jew and y. b. Write down the prot maximization condition for the rst rm in terms of 2m; and y,. c. With the prot maximization conditions of the two rms, form a system of difference equation. Determine the steady state of the system. (1. Solve the system of difference equation. e. When the initial conditions are x0 = y0 = 36, determine the constants of the solution. Will it converge

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