Question
Suppose the inverse market demand equation is P = 80 ¡V 4(QA+QB), where QA is the output of firm A and QB is the output of firm B, and both firms have a constant marginal constant of $4.
(a)Write down the Bertrand equilibrium prices for this market.
(b)Calculate the industry output.
(c)Solve for the Cournot and Stackelberg equilibrium outputs, and compare to the Bertrand equilibrium.
(a)Write down the Bertrand equilibrium prices for this market.
(b)Calculate the industry output.
(c)Solve for the Cournot and Stackelberg equilibrium outputs, and compare to the Bertrand equilibrium.