Under the condition the two cournot’s duopolistic firms have identical costs, assume that the market demand and cost functions are given as follows;
P=60-Q where Q=Q1+Q2
MC1=MC2=0
Where
Q1 is the output of firm 1
Q2 is the output of firm 2
P is the price of the market
MC1 is the marginal cost of firm 1
MC2 is the marginal cost of firm 2
By showing each of the formulas and steps required, calculate
A. The profit maximizing equilibrium out put of firm 1 and 2
B. The profit maximizing equilibrium price of firm 1 and 2
0 answers